Why Xilinx Stock tumbled today – The Fool Motley

What happened

Actions of Xilinx (NASDAQ: XLNX) it collapsed Thursday after the chip company announced mixed results for its fourth fiscal quarter. Xilinx beat analyst estimates in terms of revenue, but did not make a profit, which resulted in a 16.3% drop in inventory at 12:30. EDT.

So what

Xilinx reported revenue of $ 828 million in the fourth quarter, up 30% over the previous year and about $ 1.5 million above the average estimate analysts. Revenues in the communications sector increased 74% over the previous year, accounting for 41% of Xilinx's total sales. The data center industry recorded a 7% drop in sales, while the automotive, broadcasting and consumer goods sector gained 20%. Sales in the industrial, aerospace and defense industries increased only 1%.

Non-GAAP earnings per share were $ 0.94, up 34% from the prior year, but $ 0.02 lower than analysts' expectations. Over the full year, Xilinx achieved more than 30% growth in non-GAAP earnings and non-GAAP earnings per share. "We are following our strategy and focusing on growing our portfolio as we continue to transform into a platform company," said Victor Peng, CEO of Xilinx.

With a strong focus on the communications market, Xilinx is poised to benefit from the growth of 5G networks.

Now what

Xilinx expects to generate a turnover of between $ 835 and $ 865 million in the first quarter of fiscal year 2020. According to the company's forecasts, non-GAAP EPS of about 0.96 $ is expected.

Xilinx's fourth quarter results barely missed analysts' expectations, but high valuations may have played a role in Thursday's rout. Prior to the earnings report, the stock was trading about 40 times more than the result of the 2019 fiscal year.