AST Share Price Dips 9% to 52-Week Low
AST Research Inc. shares fell 9% on Friday after the computer maker said it expects its first-quarter loss to be worse than analysts’ estimates.
Shares of the troubled Irvine-based company fell 50 cents to a 52-week low of $5 on Nasdaq, on volume of 906,500 shares, much higher than the three-month average daily volume of 209,000 shares. The stock traded as low as $4.625.
In a sign that new leadership, new products and a massive new advertising campaign have so far been unable to reverse a staggering financial slide, AST on Thursday said its first-quarter loss will be bigger than even the most pessimistic of earlier estimates.
AST did not offer a projection, but company officials said the first-quarter loss is expected to surpass analysts’ estimates that it would lose between $48 million and $67 million.
AST, which has been plagued by production problems in recent years, has already reported six consecutive quarterly losses totaling $324 million.
In a statement, AST Chief Executive Ian Diery attributed the latest gloomy news to “excess competitor inventory in the channel, overall lower demand for PCs and greater pricing pressures than originally anticipated.”
He added that an industrywide slowdown in personal computer sales has forced AST “to take aggressive pricing actions” to clear out inventory of its business and portable computer lines in order to make way for a series of new products in the second quarter.
“We therefore anticipate that revenues will be below those achieved during the previous quarter, ended Dec. 30,” Diery said.
AST reported a record loss of $129 million on sales of $613 million for the December quarter.
Diery was hired at AST in November to replace former Chief Executive Safi U. Qureshey, who remains as the firm’s chairman.
Some analysts have questioned the company’s ability to rebuild its badly eroded market share. Samsung Electronics, the South Korean company that bought 40% of AST’s stock for $376 million last year, has helped AST secure $200 million in credit.
