* British chipmaker evaluating implications of Zoran Q1
* Zoran's Q2 outlook disappoints on Cisco, Japan
* CSR shares up 4 percent; Zoran stock down 13 pct (Adds details, updates stock reaction)
LONDON, May 9 (Reuters) - British chipmaker CSR's agreed takeover of Zoran Corp was thrown into doubt on Monday after the U.S. firm reduced its guidance on the impact of Japan's earthquake and lost business from Cisco.
The two companies announced an $679 million all-share deal in February to combine CSR's wi-fi, bluetooth and GPS location technologies with Zoran's imaging and video chips. [ID:nLDE71K09Y]
Zoran, however, said on Monday its second-quarter revenue would be between $80 million and $85 million, missing forecasts and prompting CSR to look again at the deal that was expected to close in the second quarter. [ID:nASA023IN]
Analysts were expecting revenue for the second quarter of $95-97 million from Zoran.
"While our camera team continues to execute well, Cisco's recently announced decision to exit the video camcorder segment will negatively impact digital camera revenues in the second quarter and balance of the year," Zoran said.
"During the quarter and driven by the tragedy in Japan, we saw cautious order patterns from customers across all of our core markets."
It said it was already seeing signs of recovery as optimism builds, but that was not enough to ease CSR's concerns.
CSR would pay a break fee of $12.2 million if it walks away from the deal.
Shares of CSR, which have fallen 18 percent since the deal was announced, were trading 4.11 percent higher at 369.6 pence at 1434 GMT on the London Stock Exchange as investors saw an opportunity for CSR to renegoitate the deal or walk away.
The British company, which reports first-quarter results on Tuesday, said it was "evaluating the implications" of Zoran's results.
Analysts at Numis said Zoran's guidance was clearly below CSR's expectations, and its statement that it was evaluating implications suggested the deal could be renegotiated.
RBS also said CSR could be looking for better terms.
"While we don't think CSR will walk away from the deal given the weaker results and outlook we think that CSR could ask for the renegotiation of certain terms," it said.
CSR said in a statement that it had received positive feedback from customers on the rationale behind the deal.
Analysts at Canaccord Genuity, however, said Zoran's results confirmed their belief that the merger was ill-timed.
"Ironically, therefore, Zoran's cautious commentary could be good news for CSR holders -- if the deal is now aborted, we could see this as a positive," they said in a note.
Zoran shares were trading down 13 percent at $8.37 on Monday morning on Nasdaq. (Reporting by Paul Sandle in London and Supantha Mukherjee in Bangalore; Editing by Matt Scuffham, Jarshad Kakkrakandy)