ESS Technology Revises Revenue And Earnings Guidance For 3rd Quarter
FREMONT, Calif. -(Dow Jones)- ESS Technology Inc. (NasdaqNM:ESST - News) slashed its third- quarter financial guidance due to slowing demand and increased competition from suppliers.
In a press release Thursday, the maker of products for the DVD and digital entertainment markets said it now projects third-quarter revenue of $60 million to $64 million, well below its earlier estimate of $86 million to $90 million, and earnings of 13 cents to 21 cents a share, down from the prior range of 35 cents to 38 cents a share.
A Thomson First Call survey of eight analysts produced a mean earnings estimate of 37 cents a share for the third quarter, while a survey of six analysts yielded a consensus revenue estimate of $88.9 million.
"As we go into the Christmas season, we are now finding worldwide demand has slowed down surprisingly in the latter part of the quarter," said ESS President and Chief Executive Robert Blair.
Blair also said greater competition from suppliers who offer an integrated front-end servo and MPEG decoder system has increased pressure on average selling prices, and the company expects its prices in the fourth quarter to be 10% to 15% below the third quarter.
ESS plans to ship its own integrated system, the Vibratto II, in the fourth quarter.
The company's shares were halted in the after-hours session for news dissemination, after closing Thursday at $11.23, down $1.08, or 8.8%. |
