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Novellus meets Street
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October 16, 2000: 5:59 p.m. ET
Chip equipment maker posts profit of 62 cents per share; sales rise 132%
By Staff Writer Richard Richtmyer
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NEW YORK (CNNfn) - Semiconductor equipment maker Novellus Systems Inc. reported a third-quarter profit Monday that was in line with Wall Street's expectations, on sales that more than doubled from the same period last year.
The news was officially released after the markets closed, but the company said its latest results were mistakenly posted on its Web site about an hour earlier.
The San Jose, Calif.-based company, said its net income for the quarter was $85.3 million or 62 cents per share, up 291 percent compared with $21.8 million, or 18 cents share in the same period last year. Sales rose 132 percent to $359.1 million.
 After rising to as much as $42.69 earlier in the session, shares of Novellus (NVLS: Research, Estimates) plunged in the last hour of Nasdaq trade following the unintended release of the company's financial results at 3 p.m. ET, about an hour ahead of schedule. The shares finished the session $6, or 14.8 percent, lower at $34.50. They fell to $31.38 in after-hours before recovering to $34.94.
In an interview with CNNfn.com, Bob Smith, Novellus' chief financial officer, said the company's financial results were released inadvertently by an outside firm contracted by Novellus to handle public relations. He said this firm, which he would not name, posted it on the company's Web site as well.
"It was the firm that releases it each month to our Web site with instructions from us as to what time to release it, and it was released by that firm early," Smith said.
Click here for a comprehensive look at the day's earnings
Before Novellus had a chance to remove the early release from its Web site, it was picked up and distributed on several Internet chat rooms. The reported earnings and revenue figures matched those in the earlier press release.
Smith said the company is investigating the matter.
In a conference call with analysts Monday evening, Richard Hill, Novellus' chairman and chief executive, attributed the latest quarter's results to gains in market share as well as its broader portfolio of products.
Demand for semiconductor capital equipment has been on the rise recently as chip makers scramble to equip their manufacturing plants, called fabs, to fill orders for chips. During the quarter, Novellus generated a book-to-bill ratio that was significantly greater than 1:1 for the quarter. Any ratio above that figure indicates a backlog of orders.
While there have been concerns in the market recently about whether the semiconductor industry is headed for a cyclical downturn, Hill provided a bullish forecast for the fourth quarter and predicted strong revenue gains in 2001.
"There seems to be no hold back in the investment in fabs," he said.
In the fourth quarter, Hill said he expects Novellus to have revenue of "at least" $415 million and earnings per share of 71 cents per share.
In 2001, he said he expects the company's revenue to be about $2 billion, if the company's book-to-bill continues to be as high as it has been. 
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