Mentor Graphics posts smaller 3rd-quarter loss, helped by fewer costs and higher revenue

Mentor Graphics posts smaller 3Q loss

WILSONVILLE, Ore. — Mentor Graphics Corp., a provider of electronic hardware and software design products and services, on Thursday posted a smaller fiscal third-quarter loss and said it is seeing signs of recovery in the semiconductor market.

However, it forecast weaker than expected profit and sales for the fourth quarter, sending shares tumbling nearly 8 percent in aftermarket trading.

For the three months ended Oct. 31, the company posted a loss of $27 million, or 28 cents per share, compared with a loss of $78.9 million, or 85 cents per share, in the same period a year earlier. Excluding charges related to job cuts, acquisitions and investment banking fees, the company earned 5 cents per share in the latest quarter.

Revenue climbed 2 percent to $189.2 million from $184.9 million.

Analysts, on average, were expecting an adjusted profit of 1 cent per share on sales of $183.5 million, according to a poll by Thomson Reuters.

“During the quarter, we saw positive signs of recovery in the semiconductor market with semiconductor unit shipments and revenue,” said Walden C. Rhines, CEO and chairman, in a statement. “The diversity of our product line continues to help us weather the difficult economic environment.”

But looking ahead, the company forecast fourth-quarter adjusted earnings of about 28 cents per share on sales of about $230 million. Analysts are expecting a higher profit of 32 cents per share on sales of $234.2 million, on average.

For the full year, Mentor expects adjusted earnings of 44 cents per share on sales of about $795 million, in line with Wall Street’s expectations.

Shares closed down a penny at $8.28, but dropped 64 cents, or 7.7 percent, to $7.64 in after-hours trading.