ESS Technology Reports Second Quarter Results
PR Newswire - July 22, 1998 16:59
FREMONT, Calif., July 22 /PRNewswire/ -- ESS Technology, Inc. (Nasdaq: ESST) today reported net revenues of $34.8 million for the second quarter ended June 30, 1998, within the range the company publicly announced on July 6. The company also announced a net loss of ($13.0) million, or ($0.32) per share for the second quarter of 1998. This compares with net revenues of $45.1 million and a net profit of $3.8 million, or $0.10 per share, in the second quarter of 1997, excluding a one time charge of $22.2 million or $0.57 per share for in-process research and development in the acquisition of Platform Technologies, Inc.
Revenues were influenced by slow seasonal demand, an industry slowdown in the PC market, and marketing incentive programs for the company's video product family. Major factors contributing to the loss were reduced sales and charges to inventory reserves in the company's PC audio and modem product lines.
"Sales were below our targets primarily due to lower unit shipments of our PC audio and modem products. However, our marketing programs for video products have been beneficial by reducing our video inventories and supporting our customers," said Fred Chan, Chairman and CEO. "We believe the company is well positioned with the new PCI audio and video products and are planning for these products to be major contributors in the latter part of this year. As I mentioned in our announcement on July 6, we are targeting a return to profitability by the end of the year," he added.
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