SanDisk (NASDAQ:SNDK) slumped in today’s trading after the maker of memory chips used in mobile devices such as Apple’s iPhone projected a steeper-than-expected drop in full-year revenue and said it plans to cut jobs to reduce costs.
Shares declined 4.1 percent to C$68.18 at 2:09 p.m. in New York. The stock has lost 31 percent so far this year.
Revenue in 2015 will be $5.4 billion to $5.7 billion, the company’s chief financial officer, Judy Bruner, said on a conference call with analysts late yesterday.
SanDisk earlier this year forecast about 17 percent higher annual sales. Analysts had estimated $6.15 billion.
SanDisk makes removable cards, embedded flash products, USB flash drives and solid-state drives used in place of hard disk drives.
“We are acting quickly and decisively to address the issues that have caused our underperformance,” chief executive officer Sanjay Mehrotra said on the call.
Second-quarter revenue will range from $1.15 billion to $1.23 billion, compared with the average analysts’ estimate of $1.42 billion, the Milpitas, California-based company said in a statement yesterday.
SanDisk has struggled with supply constraints, production delays and market shifts that have cost it customers and prevented the company from taking advantage of the increasing use of flash memory chips as storage in data centers. Weaker pricing for consumer-based uses of memory chips -- in digital cameras in particular -- has also affected revenue.
SanDisk's revenue fell nearly 12 percent in its fiscal first quarter ended March 29 to $1.33 billion, slightly above analysts' average estimate of $1.31 billion.
Net income fell nearly 86 percent to $39.0 million. On an adjusted basis, the company earned $0.62 per share, short of analyst estimates of $0.66 per share.
Also yesterday, The company declared a second quarter dividend of $0.30 per share, payable on May 26 to shareholders of record on May 4.