CSR misses smartphone sales boom

City A.M. Reporter
CHIPMAKER CSR forecast lower fourth-quarter revenue yesterday, reflecting a lack of exposure to smartphones and capacity constraints in the manufacture of its GPS chips, sending its shares plunging.

The maker of GPS, bluetooth and wi-fi chips for phones, cars and digital cameras said fourth-quarter revenue would be $170-$185m, down from $198m a year ago and at the midpoint 20 per cent lower than in the third quarter.

Chief executive Joep van Beurden said the guidance was below normal seasonal fluctuations – which would usually see fourth-quarter sales down about 10 per cent from the previous quarter – for three reasons:

“We are underexposed in smartphones and the smartphone market is growing very rapidly. The economy is certainly less buoyant than it was earlier, and for some of our GPS products capacity is still tight and that's weighing on Q4 as well.”

CSR’s chips are in Blackberry-maker Research in Motion’s products. They are also in Nokia’s handsets, although mainly in feature phones, which have been eclipsed by growth in smartphones. Analysts at Execution Noble said the guidance would likely push down full-year revenue consensus by about five per cent.