Alpha Microsystems Reports Loss of $7.5 Million for Year

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Alpha Microsystems, a computer maker hurt by the recession and a slump in minicomputer sales, said Thursday it lost $7.5 million for the fiscal year ended Feb. 24.

The loss contrasts with net income of $772,000 for the company’s 1990 fiscal year. Revenue for its fiscal 1991 were $52.8 million, down 5.5% from $55.9 million a year earlier.

“We’re disappointed, but not surprised,” said Chief Financial Officer David Young. “The losses are in line with what we reported earlier.”


Young attributed the loss to a continuing slump in the mid-range computer business, which is caught in a technological squeeze.

Makers of minicomputers--business computers for groups of users--are slashing prices on their machines to compete with increasingly sophisticated personal computers on the low end and less expensive mainframe computers on the high end.

Young also said computer buyers have been reluctant to purchase new systems during the recession.

Alpha Micro’s performance was poor despite cutbacks that included layoffs in August and February.

The company also suffered from the disruption caused by an aborted takeover attempt by the Aril Group, a New York holding company that offered to buy Alpha Micro for $11 million but pulled out of the deal for lack of financing.

And, since October, several top executives have left Alpha Micro.

For the fourth quarter, Alpha Micro reported a loss of $3 million, contrasted with net income of $20,000 a year earlier.


Young said he expects the company to return to profitability in the first fiscal quarter, largely because of internal cost-cutting and realignment of the company’s sales operation by geographic region instead of along product line.

The company is also trying to shore up revenue by purchasing the service operations of some of its 600 dealers.

Earlier this week, Alpha Micro introduced two new computer systems that can accommodate multiple computer users. One version, the AM-3000M model that can support 60 users, will be available during the summer.

A second version, the AM-3000 model that can support 300 users, is available now.