AST Cites Operating Costs for Drop of 61.7% in Net Earnings

Citing high operating costs and lowered profit margins, Irvine-based AST Research Inc. reported net earnings of $3.1 million for the first quarter of its fiscal 1987, down 61.7% from $8.1 million a year earlier. Sales for the period ended Sept. 30 were $40.2 million, down 8% from $43.7 million.

AST’s profit margins during the first quarter dropped because of the large number of new products introduced in the last year, according to Safi Qureshey, the company’s president. While engineering and manufacturing costs on the products remain high because they are new, prices cannot be increased without damaging their marketability, an AST spokesman said.