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Dialog Semiconductor ups 2015 gross margin guidance after first-quarter beat

FRANKFURT (Reuters) - German chipmaker Dialog Semiconductor raised its 2015 profitability forecast after strong demand for its products from smartphone makers helped it post a better-than-expected first quarter operating profit.

Dialog said it expected its gross margin for the full year 2015 to be slightly above last year's 45.3 percent. It had previously guided for a stable gross margin.

Quarterly earnings before interest and tax (EBIT), excluding special items, rose to $71 million, Dialog said on Thursday, beating the average estimate of $53.7 million (35 million pounds) in a Reuters poll.

Dialog shares were up 8.2 percent by 0815 GMT at the top of a 0.3 percent weaker German technology index.

"Dialog has delivered the consensus-beating results that we had been hoping for," said Karsten Iltgen, an analyst at Bankhaus Lampe, who has a "buy" recommendation.

Dialog makes chips that manage power consumption of consumer electronic devices such as smartphones and tablet computers. Apple and Samsung Electronics are among its main customers.

Apple last week reported better-than-expected revenues and profits as it sold more iPhones in China than in the United States for the first time, while Samsung said demand for its new flagship smartphones the Galaxy S6 and Galaxy S6 edge was strong.]

Dialog shares have gained more than 50 percent so far this year and are outperforming the STOXX Europe 600 Technology index, which is up 10 percent.

(Reporting by Harro ten Wolde; Editing by Arno Schuetze and Maria Sheahan)