Atmel shares fall on weak outlook

Atmel shares fall on weak outlook

Stock Market Predictions

(Global Markets) - Chipmaker Atmel Corp's (ATML.O) shares fell 6 percent on Thursday, a day after the company reported strong first-quarter results but gave a weak second-quarter revenue outlook.

Revenue is expected to rise 1-4 percent, sequentially, taking it to $466-$479.9 million, Atmel said in a call.

Analysts, on an average, were expecting revenue of $473.2 million, according to Thomson Global Markets I/B/E/S.

Investors were also looking for strong second quarter guidance, suggesting a linear ramp in touchscreen shipments during 2011, Capstone Investment analyst Jeff Schreiner wrote in a note.

"We believe one potential reason for less-than-stellar guidance could be some smartphone shipments occurring during the second half versus prior estimated linear acceleration through out 2011," Schreiner said.

Atmel expects gross margin to be about 51 percent in the second quarter.

First-quarter results beat estimates, helped by an increased demand for its touchscreen chips.

Shares of the company opened more than 4 percent down at $14.10 on Thursday on Nasdaq.

(Reporting by Swati Chitnis; Editing by Joyjeet Das)