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Creative Falls 9.6% On 4Q Guidance Cut, MP3 Woes |
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Wednesday, 29 June 2005 |
Creative Falls 9.6%
On 4Q Guidance Cut;MP3 Woes
Yahoo News - USA
SINGAPORE (Dow Jones)--Shares of Creative Technology Ltd. (CREAF) plunged
9.6%during early trade Tuesday on overnight news that the company reduced its
fiscal fourth-quarter guidance for revenue and gross margin, citing weakness in
its MP3 player segment.
At 0636 GMT, Creative was down S$1.20 at S$11.30.
Its share price has fallen 53.6% this year, touching a new 52-week low of S$11
in the early session.
The cut in guidance confirmed the markets' fears that the company's recent MP3
player price cuts would force Creative into the red during the quarter.
The Singapore company's MP3 players, sold under the MuVo and Zen brands, are a
distant No. 2 to Apple Computer Inc.'s (AAPL) iPod.
The consumer-electronics maker late Monday said it expects revenue for the
quarter ending June 30 to rise 50% on year to about US$300 million. It had
earlier projected a 65%-80% increase to US$330 million - US$360 million.
Gross margin for the fourth quarter is expected to be below 20%, down from its
April guidance of 22%-24%.
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