Micrel lowers 1Q revenue outlook

Micrel now projects first quarter revenues will be in a range of minus 10% to minus 11%, compared with its previous guidance range, issued on January 27, 2011 of minus 2% to minus 6%. The shortfall in revenue is primarily a result of lower than expected sales to a device manufacturer in Korea that makes wireless handsets and other consumer electronic devices. This customer moderated product deliveries during the quarter to control inventory levels. In addition, Micrel also experienced a reduction in overall demand in March related to disruptions in the worldwide electronics supply chain due to the earthquake and tsunami in Japan. The Company also had a further inventory reduction by its sell-in (POP) channel partners as a result of the inventory over-build that took place in the last half of 2010. Based upon current demand estimates, the Company expects second quarter 2011 revenues to grow sequentially over first quarter 2011 revenues. As a result of the revised first quarter revenue projections, first quarter earnings per diluted share are expected to be approximately USD 0.13-0.14, compared with the previous guidance range issued on January 27, 2011 of USD 0.17-0.19.