Mentor Graphics Profit Down, But Tops View - Update

(RTTNews) - Chip-design software maker Mentor Graphics Corp. (MENT), Thursday reported a decline in profit for the third quarter, as higher revenues were offset by one-time expenses, even as both earnings and revenues for the quarter came in ahead of Wall Street estimates.

Wilsonville, Oregon-based Mentor Graphics' third quarter profit dropped to $21.0 million or $0.18 per share from $25.5 million or $0.20 per share last year.

Adjusted earnings for the quarter rose to $39.9 million or $0.34 per share from $37.3 million or $0.32 per share last year. On average, eight analysts polled by Thomson Reuters expected earnings of $0.21 per share for the quarter. Analysts' estimate typically excludes special items.

Sales for the third quarter grew to $292.68 million from $275.64 million a year ago. Analysts had a consensus revenue estimate of $275.93 million for the third quarter.

"Strength in automotive products and services continued in the quarter and expanded into the broader transportation market, as aerospace and commercial vehicles also transition from mechanical to electronic systems," said CEO Walden Rhines.

Mentor Graphics provides electronic design automation software and hardware tools for designing and testing of complex electronic systems.

Looking forward to the fourth quarter, the company expects adjusted earnings of about $1.07 per share and revenues of about $425 million. Analysts currently expect earnings of $1.19 per share on revenues of $449.73 million for the fourth quarter.

For the full year 2015, the company continues to expect adjusted earnings of about $1.75 per share. Mentor, however, lowered its revenue outlook to about $1.23 billion from its prior forecast of about $1.24 billion. Analysts currently expect earnings of $1.75 per share on revenues of $1.24 billion for 2015.

Mentor Graphics declared a quarterly dividend of $0.05 per share, payable on January 2 to shareholders of record on December 10.

MENT closed Thursday's trading at $21.55, up $0.07 or 0.33%, on the Nasdaq.