Feb. 14--Agilent Technologies, Sonoma County's largest high-tech employer, cut its 2014 forecast Thursday as a result of lower revenue in its Santa Rosa-based electronic measurement division.
The electronic measurement division saw first-quarter revenues decline to $671 million, down 7.1 percent from a year ago.
The unit faced "challenges" in the aerospace and defense market, Agilent President and CEO Bill Sullivan told reporters and analysts in a conference call Thursday.
In addition, the timing of the Chinese New Year caused delays in shipments being accepted by customers and prevented the revenue from being included in the division's first-quarter results, said Guy SÉnÉ, senior vice president of R&D and sales in the Electronic Measurement Group.
Had those orders been counted, it would have represented an additional $15 million in revenue and brought the company closer to meeting Wall Street's expectations, SÉnÉ said.
"We basically missed because we could not recognize the products that we shipped," SÉnÉ said Thursday.
Overall, the Santa Clara company posted $1.68 billion in revenues in the first quarter, essentially flat from a year ago.
It scaled back its forecast for annual revenues and profits. Agilent now expects annual revenues to range between $6.9 billion and $7.1 billion. In November, it forecast revenues of $6.95 billion to $7.15 billion. Adjusted annual profits were lowered to $2.96 to $3.16 a share, down from the November forecast of $3.03 to $3.33 per share.
Agilent shares fell 6 percent in after-hours trading Thursday to $56.57.
Agilent is in the process of splitting into two publicly traded companies. One, which will keep the Agilent name, will focus on life sciences and the pharmaceutical industry. The other, named Keysight Technologies, will be headquartered in Santa Rosa and retain the electronic measurement business.
The local unit reported operating margins of 7 percent in the quarter that ended Jan. 31, down from 19 percent in the previous quarter.
Agilent forecast the EMG division to grow 8 percent in the second half of the year because of anticipated growth in the semiconductor market and wireless communication sector, SÉnÉ said.
Overall, Agilent's net income rose to $195 million, or 58 cents per diluted share, in the first quarter. That compares with $179 million, or 51 cents per share, a year ago.
SÉnÉ said Agilent is making "very good progress" on dividing the company into separate entities.
Keysight Technologies will begin operating as a company within Agilent on Aug. 1, and will separate from Agilent in November. The company, which will have 9,500 workers in 30 countries, employs 1,175 people in Sonoma County.
The company last month opened a new electronic testing facility at the Santa Rosa site. The 3,800-square-foot facility is designed to speed up product development and ensure they comply long-term with emerging standards for electromagnetic emissions and electromagnetic interference.
(You can reach Staff Writer Derek Moore at 521-5336 or email@example.com. On Twitter @deadlinederek.)
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