LSM303DLH 3D Compass and Accelerometer Carrier with Voltage Regulators

From section 9.2.4 of the LSM303DLH datasheet (599k pdf):

In the event the ADC reading overflows or underflows for the given channel, or if there is a math overflow during the bias measurement, this data register will contain the value -4096 in 2’s complement form. This register value clears after the next valid measurement is made.

To avoid overflowing, try reducing the gain by setting the three gain-setting bits in CRB_REG_M. If you are using our Arduino library, insert this code into the setup method after compass.enable(); to get the lowest gain (largest sensor input field range) possible:

  Wire.beginTransmission(0x3C >> 1);
  Wire.send(0x01);
  // see table 62 in the datasheet for other gain_setting values
  byte gain_setting = 0b11100000; 
  Wire.send(gain_setting); 
  Wire.endTransmission();