July 30 (Reuters) - Xilinx Inc forecast current-quarter revenue largely above Wall Street estimates on Wednesday, as rising sales of its chips to data centers are expected to outweigh the impact of a U.S. government ban on semiconductor sales to Chinese companies.
Shares of the company, which also beat quarterly revenue estimates, were up nearly 2% in extended trading.
The company said it expects second-quarter revenue of between $730 million and $780 million, compared with analysts’ average estimate of $730.3 million, according to IBES data from Refinitiv.
San Jose, California-based Xilinx makes programmable chips used in data centers to speed up tasks like artificial intelligence work and in 5G telecommunications base stations.
The company’s business suffered a setback last year when major customer Huawei Technologies Ltd was blacklisted by U.S. officials, preventing it from buying chips from U.S. companies. Government officials have since added other China-based companies, including some Xilinx customers, to the list.
Xilinx’s net revenue fell to $727 million from $850 million in the first quarter, still beating estimates of $725.6 million. The revenue beat was powered by strength in the data center unit, where sales more than doubled.
“The outperformance was due to a combination of strength in multiple end markets, as well as some order acceleration driven by recent additional U.S. government trade restrictions on sales of certain Xilinx products to some customers based, or with operations, in China,” Chief Executive Officer Victor Peng said in a statement.
Net income fell to $94 million, or 38 cents per share, from $241 million, or 94 cents per share, a year earlier.
Excluding items, the company earned 65 cents per share, beating estimates of 56 cents. (Reporting by Munsif Vengattil in Bengaluru and Stephen Nellis in San Franscisco; Editing by Maju Samuel and Anil D’Silva)
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