Here they come. . .
Gadzoox warns of low second quarter sales
Thursday September 7, 5:49 pm Eastern Time
SAN JOSE, Calif., Sept. 7 (Reuters) - Gadzoox Networks Inc. (NasdaqNM:ZOOX - news) on Thursday said it expects fiscal second-quarter sales to fall 15 to 25 percent below analysts' forecasts of $9 million due to slow acceptance of its new Capellix line of network switches.
In a statement, the maker of storage area network (SAN) products said it will take a one-time reserve between $9 million and $11 million for excess inventory that was produced based on early sales estimates.
``While the adoption of Capellix has been slower than expected, we are launching a marketing, communications and sales campaign to create broader market acceptance,'' Chief Executive Officer Michael Parides said in a statement.
He said Gadzook's management is in a ``transition period'', but the new executives support the Capellix line of products.
Parides joined the company on August 8, and Chief Financial Officer Christine Munson resigned on August 17.
The changes followed an August 7 news announcement from the company in which it restated earnings for its fiscal first quarter ended June 30, reflecting a steeper loss of 52 cents a share vs. an earlier report of a loss of 35 cents a share. It cited accounting adjustments for the restatement.
Gadzoox shares closed up 3/16 at 10-5/16 on the Nasdaq stock system. Shares have traded as high as $98 and as low as $7-10/16 in the last year. The news announcement followed the market's close.
We can use these warnings announcements as opportunities for beginning core positions in beaten downs that have moved off their bottoms without us. For instance, ZOOX at $8 right now is at its all-time LOW. . . and should be considered, IMO.
Rande Is |
