UPDATE: Xilinx increases forecast after easing of restrictions on Chinese companies, stock heads higher
Xilinx Inc. (XLNX) shares gained in after-hours trading Monday after the semiconductor company said that loosening of some restrictions on Chinese companies had helped its business. Xilinx said that it now expects fiscal first-quarter revenue of $720 million to $734 million, after previously stating $660 million to $720 million. "While we have seen some COVID-19 related impacts during the June quarter, our business has generally performed well overall, with stronger than expected revenues in our Wired and Wireless Group and Data Center Group more than offsetting weaker than expected revenues in our consumer-oriented end markets, including automotive, broadcast, and consumer," Chief Executive VIctor Peng said in the announcement. "A portion of the revenue strength in the quarter was due to customers accelerating orders following recent changes to the U.S. government restrictions on sales of certain of our products to international customers." President Donald Trump eased some restrictions on Huawei this month (https://www.reuters.com/article/us-usa-china-huawei-tech-exclusive/exclusive-us-to-allow-companies-to-work-with-huawei-on-5g-standards-sources-idUSKBN23M2DF) after lobbying from chip firms; Huawei is a major Xilinx partner. However, a Xilinx spokeswoman clarified to MarketWatch that the changes that affected its revenue were announced in late April (https://www.federalregister.gov/documents/2020/04/28/2020-07240/elimination-of-license-exception-civil-end-users-civ), and that Huawei was still not being included in the chip maker's forecasts. Xilinx shares increased more than 6% in after-hours trading following the announcement, after closing with a 1% gain at $91.96. The stock is down 5.9% so far this year, as the S&P 500 index has dropped 6.9%.
-Jeremy C. Owens; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
June 29, 2020 19:18 ET (23:18 GMT)
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