LSI’s Q3 net income jumps 25 percent

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MILPITAS, Calif. (AP) — Semiconductor maker LSI Corp. said Wednesday its third-quarter profits rose 25 percent as surging sales of its storage and networking chips boosted revenues.

The company reported earnings at the same time it announced a deal to acquire privately held SandForce Inc., a provider of flash storage processors, for $322 million cash. The agreement also calls for LSI to assume about $48 million of unvested stock options and restricted shares held by SandForce employees.

Both companies are based in Milpitas.

LSI’s net income for the three months ended Oct. 2 was $29.3 million, or 5 cents per share, compared with $23.4 million or 4 cents a share, a year earlier.

The company said income from continuing operations was $83 million, or 14 cents per share, matching the consensus estimate of analysts surveyed by FactSet. A year earlier, it was $79.5 million, or 13 cents per share.

Revenue was $546.9 million, up from $452.9 million a year earlier and on target with analysts’ estimate of $546.4 million.

Supply-chain uncertainties because of the recent flooding in Thailand may weigh on fourth-quarter results. LSI said income from continuing operations in the quarter is projected at 6 cents to 14 cents per share, while revenue is estimated to be between $500 million and $550 million. Analysts have been expecting 14 cents per share on revenue of $561.4 million.

Shares slipped 12 cents, or 2 percent, to $5.81 in after-hours trading. During the regular session, before the report was released, they rose 14 cents, or 2.4 percent, to $5.93.