Fourth-quarter earnings will fall short of analysts' expectations, 3Com warns
The Associated Press
SANTA CLARA, Calif. (June 8, 6:00 a.m. CDT) - Network equipment maker 3Com Corp. has warned that its results for the recently ended
quarter will be far short of Wall Street expectations.
3Com also is scrapping its line of cable and digital subscriber line modems for consumers to focus instead on network equipment for small
businesses.
On Thursday, the company said it was holding firm to its pledge to discontinue "product lines that lack the potential to deliver superior growth and
financial returns," adding that a glut of high-speed modems for consumers "has driven down prices and margins."
President and chief executive Bruce Claflin said business conditions worsened in 3Com's fourth quarter, which ended June 1. Revenue now is
expected to be between $450 million and $475 million, well off last year's figure of $764 million and the $575 million analysts were expecting this
quarter, according to Thomson Financial/First Call.
3Com did not update its earnings forecasts. Analysts were expecting the company to lose 45 cents per share, up from a loss of 36 cents per share in
the year-ago period.
Full results will be reported June 26.
Shares of 3Com rose 16 cents to close at $5.66 on the Nasdaq Stock Market before the announcement. In after-hours trading, shares were down to
$5.56. |
