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Technology Stocks : Applied Magnetics Corp

APM 1.350

+2.3%

Dec 10 3:58 PM EST

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To: Think4Yourself who wrote (10804)	12/8/1997 5:08:00 PM
From: Xpiderman	Read Replies (2) of 12298

Applied Magnetics Corp. Announces Significant Changes to Order Backlog December 08, 1997 16:29 Dec. 8, 1997--Applied Magnetics Corp. (NYSE:APM) announced that it has been notified by its largest customer of significant changes affecting its order backlog. The customer's changes come primarily as a reaction to the current hard disk drive oversupply in the industry's distribution channel and increasing competitive pricing pressures. As a result, the company anticipates that revenue will be down more than 30% in the current quarter (FQ 1/98) from the previous quarter (FQ 4/97). However, it is anticipated that revenue will rebound in FQ 2/98 up to 20% as compared with FQ 1/98 as drive inventories are brought into line. Unit pricing for recording heads for both the first and second fiscal quarters has decreased more than normal, reflecting the downturn in demand. As a result of these actions, the company plans to take a one-time pre-tax restructuring charge of approximately $8 million in FQ 1/98 primarily in connection with a planned realignment of offshore operations. Separately, as a result of Singapore Technologies' announced intention to liquidate the assets of its subsidiary, Micropolis Corp., the company will revise its fourth quarter and fiscal 1997 results to reflect an additional charge for bad debt related to potentially uncollectible accounts receivable and obsolete inventory. This additional pre-tax charge will amount to approximately $4.2 million. Who is APM's largest customer? WDC? Don't forget to short that stock!

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