Integrated Device Technology Shares Plunged: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Analog chip maker Integrated Device Technology (NAS: IDTI) dropped 11% in intraday trading today after reporting disappointing revenue.

So what: First fiscal quarter non-GAAP EPS of $0.12 was in line with the consensus estimate but down 14% year over year. GAAP EPS of $0.05 fell from $0.06 in the year-earlier quarter. Revenue of $151.5 declined 4% year over year and fell short of the consensus expectation of $153.5.

Now what: Management noted that the quarter's results "were within our guidance range as strong demand from our computing end market was offset by weaker-than-expected demand from customers in our communications and consumer end markets." Although gross margins increased for the fifth consecutive quarter, the weak revenue broke a four-quarter run of year-over-year revenue increases. This suggests that investor expectations seem to have gotten ahead of themselves.

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At the time thisarticle was published Fool contributor Cindy Johnson does not own shares of any company named above. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.

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