* Q4 adj EPS $0.38 vs est $0.18
* Q4 revenue beats estimates
* Sees Q1 revenue, gross margins at Q4 levels
* Stock up 8 percent in after the bell trading (Adds outlook, details from conference call)
March 4 (Reuters) - Strong sales of Internet protocol television chips drove Sigma Designs Inc's (SIGM.O) quarterly profit, which beat market estimates, and sent its shares up as much as 10 percent.
The company, which makes chips for the IPTV set-top box market and Blu-ray players, said it expected first-quarter revenue and gross margins to be at fourth-quarter levels. Sigma said the IPTV market was showing resiliency to the current economic turmoil and would continue to do so throughout the year.
"We believe the IPTV market remains strong though perhaps dampened by the economic turmoil," said Ken Lowe, vice president, strategic marketing.
"Television services have always been relatively resilient in a recession and represent a primary avenue of consumer escape," Lowe said.
IPTV formed 77 percent of revenue in the quarter. It is expected to represent "the vast majority" of its revenue this year.
Motorola MOT.N Singapore, its biggest customer, contributed 22 percent to revenue in the quarter.
Fourth-quarter earnings of 24 cents a share was however lower than the $1.12 it reported share a year ago. Excluding items, the company earned 38 cents a share. [ID:nWNAB0327]
Revenue fell 38 percent to $47.3 million. Analysts expected earnings of 18 cents a share, excluding exceptional items, on revenue of $43.4 million, according to Reuters Estimates.
Gross margins fell to 45.1 percent in the quarter from 49 percent a year ago.
Sigma shares rose $1.39 to $15.60 in after-the-bell trade. They closed at $14.21 Wednesday on Nasdaq. (Reporting by S. John Tilak in Bangalore, Editing by Dinesh Nair and Deepak Kannan)