Altera Corp. (ALTR, Financial) filed Quarterly Report for the period ended 2012-03-30.
Altera Corp has a market cap of $11.38 billion; its shares were traded at around $34.46 with a P/E ratio of 17.5 and P/S ratio of 5.5. The dividend yield of Altera Corp stocks is 0.9%. Altera Corp had an annual average earning growth of 30% over the past 5 years.
Our distributors have certain rights under our contracts to return defective, overstocked, obsolete or discontinued products. Our stock rotation program generally allows distributors to return unsold product to Altera, subject to certain contract limits, based on a percentage of sales occurring over various periods prior to the stock rotation. Products resold by the distributor to end customers are no longer eligible for return, unless specifically authorized by us. In addition, we generally warrant our products against defects in material, workmanship and non-conformance to our specifications. Returns from distributors totaled $20.2 million and $57.6 million for the three months ended March 30, 2012 and April 1, 2011, respectively. The decrease in returns when compared to the same period in the prior year was primarily driven by 2011 arrangements with certain distributors to re-balance inventory levels to support near-term end customer demand.
Gross margin rates are heavily influenced by both vertical market mix and the timing of material cost improvements. While these variables will continue to fluctuate on a quarterly basis, our gross margin target over the long term is 67%. We believe that the 67% gross margin target will enable us to achieve our desired level of balance between growth and profitability. Our gross margin percentage for the three months ended March 30, 2012 decreased by 2.5% compared with the three months ended April 1, 2011. The decrease resulted from an unfavorable vertical market mix, with a higher proportion of net sales in the Networking, Computer & Storage vertical market and a lower proportion of net sales in the Industrial Automation, Military & Automotive vertical market, when compared with the same period of 2011.
Our effective tax rate reflects the impact of a significant amount of our earnings being taxed in foreign jurisdictions at rates below the U.S. statutory tax rate. Our effective tax rate for the three months ended March 30, 2012 was 1.7%, compared with 8.7% for the three months ended April 1, 2011. The net decrease in our effective tax rate was primarily due to higher one-time tax benefits in 2012 compared to 2011, partially offset by the absence of a U.S. Federal Research and Development Tax Credit in 2012, due to its expiration in 2011. During the three months ended March 30, 2012, we reversed $6.9 million of liabilities for uncertain tax positions as a result of a Statutory Notice of Deficiency received from the Internal Revenue Service for 2005 to 2007. In addition, we reversed $5.2 million of liabilities for uncertain tax positions upon expiration of the statutes of limitations for certain foreign jurisdictions.
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Altera Corp has a market cap of $11.38 billion; its shares were traded at around $34.46 with a P/E ratio of 17.5 and P/S ratio of 5.5. The dividend yield of Altera Corp stocks is 0.9%. Altera Corp had an annual average earning growth of 30% over the past 5 years.
Highlight of Business Operations:
Our net sales of $383.8 million for the three months ended March 30, 2012 decreased by $152.1 million, or 28%, from our net sales of $535.8 million for the three months ended April 1, 2011. The decrease was primarily due to continued customer reaction to the changing global macroeconomic conditions, which reduced demand across the industry. Revenue slightly increased in the new product category but declined in all other categories. In addition, we experienced declines across all markets and a majority of our large customers. Despite this temporary interruption of our growth trends, we continue to see evidence of a “tipping point” with respect to our opportunity to displace ASICs and ASSPs, as our newest products are several process generations ahead of mainstream ASICs and ASSPs, and the resulting FPGA cost advantage is accelerating ASIC and ASSP displacement.Our distributors have certain rights under our contracts to return defective, overstocked, obsolete or discontinued products. Our stock rotation program generally allows distributors to return unsold product to Altera, subject to certain contract limits, based on a percentage of sales occurring over various periods prior to the stock rotation. Products resold by the distributor to end customers are no longer eligible for return, unless specifically authorized by us. In addition, we generally warrant our products against defects in material, workmanship and non-conformance to our specifications. Returns from distributors totaled $20.2 million and $57.6 million for the three months ended March 30, 2012 and April 1, 2011, respectively. The decrease in returns when compared to the same period in the prior year was primarily driven by 2011 arrangements with certain distributors to re-balance inventory levels to support near-term end customer demand.
Gross margin rates are heavily influenced by both vertical market mix and the timing of material cost improvements. While these variables will continue to fluctuate on a quarterly basis, our gross margin target over the long term is 67%. We believe that the 67% gross margin target will enable us to achieve our desired level of balance between growth and profitability. Our gross margin percentage for the three months ended March 30, 2012 decreased by 2.5% compared with the three months ended April 1, 2011. The decrease resulted from an unfavorable vertical market mix, with a higher proportion of net sales in the Networking, Computer & Storage vertical market and a lower proportion of net sales in the Industrial Automation, Military & Automotive vertical market, when compared with the same period of 2011.
Our effective tax rate reflects the impact of a significant amount of our earnings being taxed in foreign jurisdictions at rates below the U.S. statutory tax rate. Our effective tax rate for the three months ended March 30, 2012 was 1.7%, compared with 8.7% for the three months ended April 1, 2011. The net decrease in our effective tax rate was primarily due to higher one-time tax benefits in 2012 compared to 2011, partially offset by the absence of a U.S. Federal Research and Development Tax Credit in 2012, due to its expiration in 2011. During the three months ended March 30, 2012, we reversed $6.9 million of liabilities for uncertain tax positions as a result of a Statutory Notice of Deficiency received from the Internal Revenue Service for 2005 to 2007. In addition, we reversed $5.2 million of liabilities for uncertain tax positions upon expiration of the statutes of limitations for certain foreign jurisdictions.
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