ESS Technology's Rebound May Slow If DVD Sales Drop, WSJ Says
By Art Daniels
New York, April 30 (Bloomberg) -- ESS Technology Inc., the chip designer whose share price rose to a year-high $25.99, could lose steam as signs indicate the market for digital videodisc players is slowing, the Wall Street Journal reported in its ``Heard on the Street'' column.
The Fremont, California-based ESS attracted investors' attention by twice raising financial targets for the first quarter, as it posted results last week above those expectations and also gave another optimistic forecast, the paper said.
After focusing initially on the personal computer market and suffering during the drop in sales of personal computers, ESS transformed itself into the leading developer of chips for manufacturers of DVD players, the paper said.
DVD sales in the U.S. soared 50 percent last year, according to the Consumer Electronics Association. While the trade group expects sales to grow 25 percent this year, its data show that shipments of DVDs from manufacturers to retailers increased by only 1.8 percent in March, compared with 151.8 percent growth in the year earlier period, the paper said. |
