Monday, January 28, 2019

US Semiconductor Companies Update of Pretax Earnings During the Trump Administration: First Six Months of Euphoria and Then Reality Starts Sinking in and Quicksand is Hit

......................................................................

From a review of company SEC filings and of MSN Money individual company common stock information, I found 52 US Semiconductor Companies with stock market caps sometime in 2018 of more than $1 Bil.

My Focus is on Pretax Income rather than on After-Tax Net Income because Corporate Income Taxes are simply a transfer of financial wealth between US Corporations and the US Federal, US State and Foreign Governments.  It has nothing whatsoever to do with Company Operating Performance.

In the December 2016 quarter immediately before the Trump Administration took office, these US Semiconductor Companies posted Total Pretax Earnings Growth of 26%.

Then in the first two quarters of the Trump Administration, these US Semiconductor Companies posted truly spectacular Total Pretax Earnings Growth of 163% in the 1Q of 2017 and of an even higher 210% in the 2Q of 2017.

But these US Semiconductor Companies Total Pretax Earnings then started to hit quicksand, with a substantially decelerated Total Pretax Earnings Growth of 73% in the 3Q of 2017, followed by 65% in the 4Q of 2017.


And the Total Pretax Earnings of these US Semiconductor Companies started getting deeper and deeper in the quicksand in 2018, with this Total Pretax Earnings Growth dropping precipitously in 2018, declining from 58% Total Pretax Earnings growth in the 1Q of 2018 to 36% in the 2Q of 2018 and to 17% in the most recent 3Q of 2018.

Also, so far with the US Semiconductor Companies which have already released their December 2018 Quarter Earnings, this 3Q of 2018 Total Pretax Earnings Growth of 17% is headed even further south.
  • Intel, by far the largest of these 52 US Semiconductor Companies, reported Pretax Income in the 4Q of 2018 which declined by 7% from the 4Q of 2017, after posting a Pretax Income increase of 20% in the 3Q of 2018.
  • The very large Texas Instruments reported Pretax Income in the 4Q of 2018 which declined by 3% from the 4Q of 2017, after posting a Pretax Income increase of 8% in the 3Q of 2018.
  • The large Lam Research posted its second straight weak quarter with Total Pretax Income declining by 10% in the 4Q of 2018 and also declining by 14% in the 3Q of  2018, after it increased by 59% in the 2Q of 2018.
  • Xilinx was the one bright spot but it is much smaller than the above 3 US Semiconductor Companies.     

Then today the huge US Semiconductor Company Nvidia unexpectedly warned on substantially lower revenues for its January 2019 quarter than what it previously disclosed.
The below chart shows the Gold-Standard US GAAP Pretax Income From Continuing Operations for each quarter from the 4Q of 2015 through the 3Q of 2018 for each of these 52 US Semiconductor Companies.
US US US US US US US US US US US US
GAAP GAAP GAAP GAAP GAAP GAAP US US GAAP GAAP GAAP GAAP GAAP GAAP US US
Pretax Pretax Pretax Pretax Pretax Pretax GAAP GAAP Pretax Pretax Pretax Pretax Pretax Pretax GAAP GAAP
Income Income Income Income Income Income Pretax Pretax Income Income Income Income Income Income Pretax Pretax
(Loss) (Loss) (Loss) (Loss) (Loss) (Loss) Income Income (Loss) (Loss) (Loss) (Loss) (Loss) (Loss) Income Income
Sep Sep June June March March (Loss) (Loss) Sep Sep June June March March (Loss) (Loss)
Oct Oct July July April April Dec17 Dec16 Oct Oct July July April April Dec16 Dec15
or Nov or Nov or Aug or Aug or May or May Jan18 Jan17 or Nov or Nov or Aug or Aug or May or May Jan17 Jan16
2018 2017 2018 2017 2018 2017 or Feb18 or Feb17 2017 2016 2017 2016 2017 2016 or Feb17 or Feb16
Quarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter
US Semiconductor Co End End End End End End End End End End End End End End End End
mils $ mils $ mils $ mils $ mils $ mils $ mils $ mils $ mils $ mils $ mils $ mils $ mils $ mils $ mils $ mils $
       
Intel      7,142      5,930      5,529      4,572      5,011      3,815      6,035      4,440     5,930     4,318     4,572     1,670     3,815     2,508     4,440     4,303
Micron Technology      3,773      2,792      4,346      2,322      3,714      1,739      3,454         932     2,792        211     2,322      (167)     1,739      (200)        932          91
Texas Instruments      1,924      1,789      1,706      1,486      1,553      1,255      1,550      1,497     1,789     1,381     1,486     1,102     1,255        950     1,497     1,139
Broadcom Ltd      1,422         645      1,229         548      1,099         365         795         267        645        235        548      (420)        365   (1,316)        267        394
NVIDIA      1,081         896      1,180         684      1,311         536      1,078         726        896        621        684        317        536        241        726        253
Applied Materials         998      1,074      1,239         978      1,295         908      1,162         771     1,074        740        978        564        908        395        771        314
Lam Research         591         688         958         603         772         531         734         385        688        293        603        282        531        161        385        209
Analog Devices         458         382         441         127         402           87         339         233        382        323        127        256          87        195        233        182
KLA-Tencor         428         336         406         325         366         319         347         307        336        222        325        328        319        210        307        185
Skyworks Solutions         343         348         311         307         292         281         386         321        348        291        307        236        281        255        321        418
Xilinx         239         194         213         171         186         171         195         163        187        176        182        182        171        170        163        155
Maxim Integrated Products         234         181         224         196         222         170         198         148        181        165        196        116        170        171        148          80
ON Semiconductor         216         168         193         143         157         115         121           18        168          87        143          33        115          42          18          41
IPG Photonics         128         161         164         142         142         101         148         106        161          95        142          95        101          70        106          83
Advanced Micro Devices         114           83         122         (39)           89         (28)           53         (46)          90      (402)        (13)          98        (68)      (108)        (46)        (92)
Amkor Technology           72           82           44         153           13         (15)           89         120          74          85        149            9          (9)            1        120          (9)
First Solar           60         213         (55)           12           95           15         (34)       (695)        213          82          12          (4)          15        224      (630)        149
Cirrus Logic           57           90           (5)           48           22           45         105         146          90        103          48          22          45          21        146          62
Cypress Semiconductor           56           18           33         (12)           14         (38)         (39)         (72)          16          13        (18)      (525)        (41)      (100)        (72)        (57)
Cabot Microelectronics           45           33           43           26           37           23           37           28          33          25          26          21          23          12          28          13
Diodes Inc           44           20           36           20           26             2           21             3          20          16          20            9            2          (2)            3          (7)
Mellanox Technologies Ltd           41             6           16           (6)           11         (14)           (8)           12            6          13          (6)            5        (14)          (5)          12          21
SMART Global Holdings           39           24           33           (6)           37           11           43            -            24          (3)          (6)          (1)          11            1  N/A   N/A 
Integrated Device Technology           37           19           34           16           25           28           33           29          19          25          16          17          28          23          29          29
Monolithic Power Systems           36           25           27           16           22           15           27           18          25          16          16          12          15          11          18          12
Qorvo           33           36         (62)         (40)         (44)         (37)           65           45          36          30        (40)        (10)        (37)          (3)          45        (21)
Kulicke and Soffa Industries           28           44           68           17           41           38           40           18          39            5          13          39          34          12          18          (1)
Silicon Labs           22           22           15           18           22           13           23           20          22          21          18          17          13            6          20            4
Power Integrations           19           17           17           15           15           13           15           14          17          13          15          12          13          11          13          11
Oclaro           13           33             9           30           11           39           22           30          33            4          30          10          39            1          30            1
OSI Systems           11           15           (1)             6             3           19           13             7          15            1            8          (1)          19          13            7          -  
Semtech           11           17           31           17           (5)           16           11           11          17          37          17          14          16          11          11          -  
Acacia Communications           10           10         (11)           (6)         (13)           30             6           42          10          37          (6)          20          30          16          42          14
FormFactor             9           14           11           19             2             6             4         (15)          14        (14)          19          (7)            6        (14)        (15)          (1)
Lattice Semiconductor             7         (43)         (19)         (13)           (5)           (7)           (7)           (6)        (43)        (11)        (13)          (9)          (6)        (18)          (6)        (42)
nLight             5             3             6             1             4            -    N/A   N/A   N/A   N/A   N/A   N/A   N/A   N/A   N/A   N/A 
Synaptics Inc             4         (23)         (14)           16         (18)           11         (29)           29        (23)            5          16        (24)          11          22          29          45
Ceva             3             7           (2)             3           (2)             5             4             7            7            4            3            3            5            2            7            3
Ultra Clean Holdings           (2)           23           22           23           27           19           22           12          23            5          23            3          19          (2)          12          (3)
Finisar           (7)             5         (22)           22         (30)           35         (12)           51            5          52          22          26          35          12          51          10
Ambarella           (8)           15           (6)             6           (9)             3             2           20          15          30            6            9            3            1          20            9
Cree Inc           (9)         (15)         (25)           (4)       (278)         (10)            -             15        (15)          (5)          (4)          (4)        (10)          (4)            4          11
Applied Optoelectronics           (9)           18           10           34             1           23             9           15          18            6          34            1          23          (2)          15            3
Viavi Solutions         (10)           (6)         (18)           18           (8)           30           (5)           55          (2)          84          18        (74)          30          39          55            2
Rambus Inc         (15)           14         (16)             5         (39)           10           12           (3)          14            9            5          10          10            6          (3)          18
Maxlinear         (16)         (15)           (3)         (19)           (0)           10         (10)             9        (15)          11        (19)          23          10          22            9          (8)
Inphi Corp         (23)         (59)         (28)         (15)         (31)         (11)         (12)             3        (59)            8        (15)            1        (11)          -              3            2
Xperi         (24)         (17)         (32)         (13)         (36)         (46)           17           (7)        (17)          35        (13)          35        (46)          27          (7)          35
MACOM Tech Solutions         (26)             7         (95)         (11)         (18)         (44)         (16)           (2)            7          (8)        (11)          21        (44)        (16)          (2)        (19)
Microchip Technology         (39)         186           38         166         188           72         197           83        186          25        166        (91)          72          58          83          50
Marvell Technology         (44)         156         (23)         132         132         105           59             5        156          99        132          57        105        (13)          (8)          16
SunPower       (110)         (76)       (481)       (107)       (145)       (235)       (752)       (304)        (84)        (49)      (110)        (86)      (150)        (98)      (304)      (131)
Total all 52 Companies    19,411    16,585    17,836    13,154    16,678    10,545    16,547    10,011   16,563     9,565   13,173     4,252   10,589     4,019   10,051     7,976
Quarter % Increase 17% 36% 58% 65% 73% 210% 163% 26%


Posted by at