The garden that grows on this Lattice is made up of silicon. Lattice Semiconductor is a top developer of programmable logic devices (PLDs), including in-system programmable (ISP) devices that manufacturers configure and reconfigure once the chips are attached to a printed circuit board. Lattice also makes low-density logic devices and sells software used to customize its chips, which are used in communications, computing, industrial, consumer, and automotive applications. The fabless chipmaker has expanded into the market for field-programmable gate arrays (FPGAs), another type of programmable chip. More than 85% of sales comes from outside the US, primarily from the Asia/Pacific region.
Lattice Semiconductor sells primarily through distributors: Arrow Electronics and its Nu Horizons Electronics subsidiary (combined, 22% of sales), Avnet (17%), and Weikeng (14%). The company's relationship with Avnet terminated in mid-2011; the companies agreed to terms of an inventory transition that would minimize disruption to customers. Lattice Semiconductor also sells directly through a network of sales representatives, and uses direct sales management and a field applications engineering organization to provide end-user and indirect sales support.
Year-over-year sales in 2011 were up 7% to $318 million, after rising more than 50% in 2010, and the company's net income increased by more than a third for the year. In 2010 Lattice Semiconductor reported profits for the first time since 2006. Sales improved across all end markets other than its largest (communications) and all but its mainstream product line. The improvements were primarily a result of increased unit sales. New product sales were up 16% for the year, after pulling in a more than 90% increase in 2010. However, increased sales volumes related to mature and mainstream products -- which carry a higher gross margin than new product lines -- were strong contributors to improvements in the company's bottom line. Gross margin increases when sales for a product are high compared to the cost associated with producing the product.
The company also touts lower costs achieved through restructuring and improvements in its distribution channels for improved results. A 2011 restructuring plan further reduced and refocused its workforce, streamlined supply chain activities at its headquarters, and moved certain development capabilities and logistics activities to the Philippines.
Lattice Semiconductor continues to conduct most of its product development work in the US, through facilities in California, Illinois, Oregon, and Pennsylvania. It also has development centers in China, India, and the Philippines, and operational centers in the Philippines and Singapore. In 2010 the company expanded its presence in India by establishing a sales and support facility to support rapid growth in the country.
Lattice Semiconductor is dependent to a large extent on the communications market, and on demand from telecommunications equipment manufacturers. The company gets more than 40% of sales from makers of communications equipment, lower than in prior years but . In addition, its low-power products are used in smartphones, GPS devices, and digital cameras, segments of the communications market that the company has not served before.
The fabless semiconductor company uses contract manufacturers to produce its wafers. Fujitsu Semiconductor makes most of the company's new products. Other chip makers that produce devices for Lattice on a contract basis include GLOBALFOUNDRIES, Seiko Epson, and United Microelectronics. Lattice Semiconductor added production capability through Taiwan Semiconductor Manufacturing Company with its acquisition of SiliconBlue.
Lattice Semiconductor looks for growth through acquisitions that complement existing product lines, expand market reach, and increase technological capabilities. In 2012 the company paid about $62 million for SiliconBlue Technologies, which provides FPGA devices for the consumer handheld industry. SiliconBlue's devices let mobile designers quickly add features to their mobile platform, primarily in the areas of connectivity, memory, storage, sensors, imaging, and video.
In 2011 Lattice Semiconductor acquired Hong Kong-based Rise Technology Development Company and its Philippine-based subsidiary APAC IC Layout Consultants, which provides engineering layout and design services. The purchase of Rise and APAC IC was part of an effort by Lattice to improve its research and development capabilities while reducing related costs. APAC IC added a development center in the Philippines, where labor costs are lower. – less
3 salaries reported
$132,364 per year