Agilent Technologies profits down, revenues up in first quarter
Published: Thursday, February 14, 2013 at 1:29 p.m.
Last Modified: Thursday, February 14, 2013 at 6:23 p.m.
Agilent Technologies, the largest high-tech employer in Sonoma County, reported that profits fell 22 percent in the first quarter as the growth of the smartphone market slowed in developing countries and orders for Agilent's testing equipment were delayed.
The company also lowered its expectations for annual sales, prompting CEO Bill Sullivan to say that Agilent would be cutting jobs in its temporary workforce. The number of impacted workers, locally or nationally, was not disclosed.
“We will see the full impact of this as we go through, quarter for quarter,” Sullivan said in a conference call with investors.
Overall, the company reported first-quarter profits of $179 million, or 51 cents per share, down from $230 million, or 65 cents per share, a year ago. Excluding one-time expenses, the company reported profits of 63 cents a share, missing analyst's expectations. Agilent stock fell 8 percent to $41 a share in after-hours trading.
“We had this quarter nailed on Jan. 16 when I spoke with the board of directors, and then all of a sudden someone says, 'We can't take a delivery,'... and you're sort of stuck,” Sullivan said.
The company, headquartered in Santa Clara, has about 20,500 employees worldwide with 1,150 in Sonoma County, mostly in the electronic measurement group. The number of temporary employees changes from month to month, and is not disclosed, said Guy Séné, president of the electronic measurement group.
“When the business is more tense and volatile, as it is now ... it implies a reduction of our flex force,” Séné said. “There are definitely temp workers that we need in the core programs, that will stay with us still going forward. And some others that, because of reduction in programs and reduction in business, will be reduced.”
First-quarter revenues in the Santa Rosa-based electronic measurement division declined to $722 million, down 7 percent from a year ago, primarily due to an anticipated decrease in the communications market. Expenses within the group have been managed very tightly for the past year, and fluctuations in its temporary workforce have been ongoing, Séné said.
The company's overall revenues grew to $1.68 billion in the quarter that ended Jan. 31, up 3 percent from the previous year. Agilent now anticipates annual revenues of $6.9 billion to $7.1 billion, down from an estimated $6.9 to $7.2 billion.
Uncertainty over government defense spending also contributed to the weaker than expected results, because 10 percent of Agilent's business is linked to aerospace defense, Séné said.
The Santa Rosa team remains strong, and is continuing to develop new products, he said.
“Despite the fact that we missed our guidance, and that we saw lower revenue and very small growth over the year, we are really committed to keep our investments intact,” Séné said.