Needham & Company Downgrades O2 Micro International (OIIM) to Hold amid Q4 Warning

Needham & Company downgraded O2 Micro International (NASDAQ: OIIM) from Buy to Hold.

The firm comments, "OIIM revised its Q4 revenue guidance down ~11% from its prior guide and also slightly lowered its GM guidance, down 50bps at the midpoint to 51-52%. Note this is the third consecutive quarter of downward revisions out of OIIM. Broad-based weakness in its end markets was management's primary explanation, in addition to declining global chip sales and lower than normal inventories. Management also originally believed that demand in China was increasing late in the quarter but this turned out to not be the case and order deteriorated as the quarter progressed. This is a continuation of estimate reductions on our behalf as OIIM contends with dramatic slowdown in the notebook market and overall display declines."

The firm lowered 2012 revenue/EPS estimates from $99M/($0.63) to $97M/($0.67) and our 2013 revenue/EPS from $93M/($0.20) to $85M/($0.35).

For an analyst ratings summary and ratings history on O2 Micro International click here. For more ratings news on O2 Micro International click here.

Shares of O2 Micro International closed at $3.24 yesterday.

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