Ouch! Affymetrix warns:
>>SANTA CLARA, Calif., June 11 /PRNewswire/ -- Affymetrix, Inc., (Nasdaq: AFFX - news) today announced that it expects revenues for the second quarter of 2001 to be in the range of $44 to $50 million including $3-$4 million in revenue from Perlegen Sciences, Inc. The revenue shortfall relative to recent analyst expectations is due to lower than anticipated orders for the Company's GeneChip® product line and a further decline in the spotted array instrumentation marketplace. Although the Company is managing expenses, it is not reducing R&D and infrastructure investments in a manner that would be harmful to its long-term opportunity. As a result, the Company expects to report a net loss for the quarter of $4 to $7 million, excluding non-cash, acquisition-related charges.
The Company believes multiple market factors stemming from the current economic climate are contributing to the unanticipated weakness in orders, making it increasingly difficult for the Company to predict its financial performance with certainty at this time. The Company does not expect further weakness in its overall business, but believes that it could be sporadic for at least the next two to three quarters. Affymetrix will provide further updates when it reports its actual second quarter financial results.
``Affymetrix has created a new industry and has grown rapidly over the past few years. The nascent state of our market combined with variable economic conditions and rapidly changing dynamics affecting our largest customers have made it challenging to accurately forecast growth,'' stated Stephen P.A. Fodor, Ph.D. Chairman and CEO of Affymetrix. ``Despite the current slowdown, our customers increasingly tell us that GeneChip technology is rapidly becoming an indispensable tool for scientific discovery as well as drug development. Thus, we remain highly optimistic about our longer-term financial prospects,'' concluded Fodor.
The Company's current financial performance appears to be principally due to business uncertainties impacting the pharmaceutical industry, sporadic ordering patterns from a few of its large customers and a continued decline in the spotted array marketplace. In contrast, these factors do not appear to be affecting growth of the Company's GeneChip product line in the academic and biotech market segments.
Industry specific factors such as consolidation trends appear to be impacting decision making by pharmaceutical companies, leading to fluctuations in customer ordering patterns and management of their inventory levels. In addition, the Company's murine array replacement program appears to be having a greater impact than anticipated on the initiation of new array-based studies. Performance of the Company's spotted array product line is consistent with a continued shift in user preferences away from do-it-yourself arrays to pre-synthesized arrays.
Investors may listen to Affymetrix' management discuss this announcement and its financial implications by dialing domestic: 800-248-9412, international: 212-896-6082 on June 11, from 2:15 - 3:00 p.m. PT. A replay of this call will be available until 4:00 p.m. PT on June 15 at the following numbers: domestic: 800-633-8284, international: 858-812-6440, reservation number: 19111359. To access a Webcast of the conference call go to www.affymetrix.com/about/index.html, then click on ``Investor Information.''<<
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