EZchip Semiconductor Ltd. (Nasdaq: EZCH; TASE:EZCH) has lowered its third quarter guidance by 14% to $19 million. The Yokneam-based company, which produces high-performance network processors, saw its share price fall 12.6% on the Tel Aviv Stock Exchange (TASE) to NIS 80.5, after the announcement. On Nasdaq the share opened 10.76% down at $22.07, giving a market cap of $643.5 million.
EZchip CEO Eli Fruchter said, "In the third quarter of 2014 we have seen weakness in orders as well as inventory adjustments across most of our key customers that are serving the carrier networking equipment space. We believe this is a temporary slowdown, caused primarily by a weaker carrier spending environment that the market is currently going through."
He added, "Looking further out, carrier spending is forecasted to resume growth and with it our corresponding sales into this market. Concurrently, we are making good progress with our NPS which expands our reach to new markets, primarily data centers, NFV and SDN. Our pending acquisition of Tilera, which is expected to close during Q4, subject to US regulatory approvals, will further diversify the market segments and customers we serve and provide additional growth opportunities."
Published by Globes [online], Israel business news - www.globes-online.com - on October 6, 2014
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