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Intersil Corp Q4 2007 Earnings Call Transcript

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2008-01-23 19:05:36.0

Tags: Intersil

Question-and-Answer Session

Operator

(Operator Instructions). Your first question comes from the line of Ross Seymore with Deutsche Bank. Please proceed.

Ross Seymore - Deutsche Bank

Thanks guys. Nice quarter. Two questions, the first one is on gross margin. It was up despite the mix being bit of a headwind in the fourth quarter, so if you could just comment a little bit on what was going on there and then maybe I missed Dave what you expect the first quarter gross margin to be?

Rich Beyer

Okay Ross, this is Rich. We expanded gross margin in the fourth quarter on the back of several things. One, we have got continued improvement in the amount of gross of general purpose products. Secondly, we are continuing to drive operational performance through improved things like yields and our costs. And thirdly, we are benefitting from some shifts even within some application specific markets. VDSL supplanting, ADSL at higher margins, RS-45 taking on a greater share of interface products, DVD, Blu and HD taking on more of the share of our revenue from DVD Rad. So those three things helped us to improve in Q4.

Dave Zinsner

And then for the first quarter Ross, this is Dave. I'd really expect it to be a similar story, we are expecting margin expansion again in the first quarter from the reasons that Rich has stated.

Ross Seymore - Deutsche Bank

Okay. And then one follow-up on more on the revenue lines? Could you guys just talk about what you are seeing in the current environment, seasonal versus any sort of macro change and maybe by segment? Which are your segments of the four, do you expect to be the fastest growing and the slowest growing for 2008 as a whole?

Dave Bell

Well. This is Dave Bell. We are not making any projections for 2008 as a whole at this point. But obviously as we mentioned, our business tends to be seasonal in the second half of the year, strength in computing and consumer. Those are not going to be strong in the first half of the year. But we do expect to see some resumption and some strength in the communications business in the first quarter as I mentioned in my prepared remarks.

Ross Seymore - Deutsche Bank

Okay. Thank you.

Dave Bell

You're welcome.

Operator

Your next question comes from the line of Craig Ellis with Citigroup. Please proceed,

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