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Stock Analyst Update

Who Said Applied Micro Circuits' Growth Was Slowing?

Communication chipmaker's results demonstrate firm's lead.

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Applied Micro Circuits (AMCC) posted stellar growth numbers, beating consensus earnings estimates by almost 25% and proving that investors' fears surrounding the past quarter were unfounded. Still, after quickly rebounding over the past two weeks from a temporary slump, the firm's shares are probably only suited for only the most aggressive investors.

Even though sales from the firm's top customer, Nortel Networks (NT), were not as strong as in prior quarters, business from new and emerging equipment makers more than adequately compensated. Sales from Nortel increased by only 10% over the prior quarter, but sales from non-Nortel customers increased 50% over the same period.

Jeremy Lopez does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.