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Steve's Gadget Blog
British ‘iPhone chipmaker’ sees falling demand; stock crashes
October 02, 2008
Edinburgh-based chipmaker Wolfson Microelectronics reported a sharp downturn in orders in the past few days, as weak consumer confidence hits demand. The news has sent its shares tumbling by as much as 25% to a new low.
It said it now expects fourth-quarter revenue to be between $45m and $50m, compared with a previous consensus expectation of $58.87m according to a survey of three analysts by Reuters Estimates.
The company, which makes chips for products including Apple’s iPhone, said it experienced a “material reduction” in orders intake and more rescheduling of orders in recent days...[click continue reading for more on this entry]...
Memory chip makers are reporting that they are suffering from a downturn as a result of a supply glut and falling demand for consumer electronic devices.
Wolfson, which named former Motorola exec Mike Hickey as its chief executive last month, also reduced its third-quarter gross margin estimates to between 50- and 51% from 52%, despite maintaining revenue guidance for the quarter at $56- to $62m.
Analysts at brokerage Panmure Gordon & Co cut their share price target for Wolfson to 100 pence from 120p, but maintained their 'hold' rating on the stock.
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