Conexant Drops Outlook

Newport Beach-based Conexant announced this morning that it is dropping its first quarter outlook by $35 to $45M. The company said that it is expecting to consume $50M in channel inventory from the firm, which will put its approximate first quarter revenues at $140M vs. a prior $175 to $185M in November. The company will take a charge against earnings due to lower market prices and lack of end user demand for its DSL and wireless LAN products. The company also said that it would reduce operating expenses by consolidating administrative functions and shifting its product development overseas to India and China. The company had earlier this month announced that it was offshoring parts of its operation to India.