Graphics card maker Creative Technology has issued a profit warning, saying its turnover and profits will fall below market expectations.
That caused its share price to fall on the Nasdaq exchange by $2.50 to $13.88 at the close of transactions yesterday.
The Singapore based company warned that its turnover will drop by around 10 per cent on last year. It had previously predicted that it would see flat revenues.
Margins were hit by price pressure on both the 2D and 3D graphics card markets, the company said. It added that those pressures had hurt sales of its system integration bundling deals. The situation was worsened by high levels of overstocking in the marketplace.
Creative also said sales for the quarter were hit because it was forced to postpone its Soundblaster Live product. If this had shipped on time, the company claims it would have been able to reduce prices on existing devices and so increase turnover. The new range will now arrive in July.
One bright spot was that sales of Voodoo2 products in the fourth quarter continued to be strong.
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