Goldman Sachs Maintains Neutral on Xilinx After Lowered Guidance

Goldman Sachs has published a research report on Xilinx XLNX after the company lowered its guidance in an update today. In the report, Goldman Sachs writes, "Xilinx lowered its revenue guidance in an unscheduled update on Dec. 19. It now expects sales to be down 9% to 12% qoq (implied $489-$505 mn), lower than prior guidance of down 3% to 8%, and below both the Street at $520 mn and GS at $511 mn. The company noted weaker sales from large communications customers, and we believe that a portion of the incremental weakness may have come from Asian OEM customers in particular (consistent with the weakness that primary competitor Altera noted in its mid-quarter update on Dec. 8). Given the weakness at large customers (which typically have lower gross margin), Xilinx increased its CY4Q11 gross margin guidance to 65% from 64% prior." Goldman Sachs maintains its Neutral rating and $27 price target on Xilinx, which is currently trading down $0.26 from Friday's $31.21 closing price.