Sync Research Expects Loss of $6 Million

Sync Research Inc., which has struggled since its dazzling Wall Street debut in 1995, said Thursday that it will report disappointing financial results for the first quarter, and that it is moving to slash expenses by as much as 20%.

The Irvine-based company, which makes computer networking devices, said it expects first-quarter revenue of about $5.6 million, about half of what analysts were expecting. Further, Sync said it expects to incur a net loss of about $6 million, including restructuring charges. The company lost $860,000 in the first quarter last year on sales of $6 million.

John Rademaker, chief executive of Sync, said that the company will try to trim costs by 15% to 20% over the next few weeks, but he declined to comment on the possibility of layoffs. Sync employs about 200 people.

Rademaker said the disappointing results are partly due to a reshuffling of the company’s sales force following Sync’s acquisition of Tylink Corp. of Norton, Mass., for about $40 million in stock last August.

“We moved people around and in the process we believe we lost contact with some prospects that would have resulted in revenue,” Rademaker said. “That’s something that is imminently fixable.”

Rademaker also referred to a widespread slowdown in corporate buying of technology that has troubled many large high-tech companies in recent months.

“There appears to be a general networking industry phenomenon of temporarily halting their decision making,” Rademaker said. He said that corporate buyers have tired of the “rapid pace of change in technology.”

Sync makes devices that enable staid but reliable mainframe computer networks to take advantage of newer and cheaper ways of transmitting data over telephone lines.

Sync was one of the hottest stock offerings of the year in November 1995, when the company’s stock soared from an offering price of $20 to $44 in one day. Wednesday’s announcement was made after the stock market closed. Sync’s stock finished at $6.25 per share, unchanged in trading on the Nasdaq market.