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Atmel Corporation (ATML - Analyst Report) declared that its AVR UC3L microcontroller has recently been chosen by leading telecommunication equipment maker Samsung to support its latest Galaxy Note II. With the association, the company’s AVR UC3L microcontroller, powered by picoPower technology, will be particularly used as a sensor hub management solution for Galaxy Note II.

With a 5.5-inch, high-definition super AMOLED display, Galaxy Note II is designed with a 1.6GHz quad-core processor and it runs on Android's 4.1 operating system, which is usually known as Jelly Bean. The tablet has various features such as detect motion sensor, accelerometer, RGB light, digital compass, proximity, gyro and barometer. Now with the inclusion of Atmel’s AVR UC3L controller, Galaxy Note II’s real-time direction accuracy will improve; its performance will be enhanced by proper orientation and inclination of data and the product’s total battery life will get a boost from minimized power consumption. 

Management at Atmel expressed confidence stating that Samsung is considered to be a key provider of motion sensing features and applications. Atmel’s advanced solution through Real-Time Sensor Fusion Processing will enable tablet users to experience superior motion-related applications such as Gaming, Navigation and Virtual Reality.

California-based Atmel Corporation designs, develops, manufactures and sells integrated circuit (IC) products. These products include microcontrollers, advanced logic, mixed-signal, non-volatile memory and radio frequency (RF) components. Touch-sensing technology is the fastest growing area of Atmel's microcontroller business and is expected to remain a major growth driver in the coming quarters. The growing popularity of this technology is driven by the rapid use of smartphones, the rise of Android tablets and the penetration into the latest applications including tablets, netbooks, cameras, printers, automotive and other areas.

Earlier, Atmel’s maXTouch controllers have been selected to power nearly 30’ Windows 8 touch-compatible devices including tablets, Ultrabooks and notebook PCs. The high demand for the company’s latest maXTouch solutions is expected to improve its business in the touch sensing market.

Although Atmel is a globally renowned enterprise, it operates in an intensely competitive landscape. The company’s primary competitors include big players such as LSI Corporation and Semiconductor Manufacturing International Corp. (SMI - Snapshot Report). LSI recently launched its latest Syncro MX-B Rack Boot Appliance to enhance the power of boot drives. Given the competition, technological upgrades are the only means of survival. However, it involves costly R&D that can put margins under pressure.

The current Zacks Consensus Estimates for Atmel are 4 cents and 19 cents for the fourth quarter and full year 2012, respectively. The lingering weakness in the macro economy is reflected in the stock’s Zacks #3 Rank for the short term. We also maintain a long-term Neutral recommendation on Atmel.

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