O2Micro (OIIM) Cuts Q4 Outlook; Cites End Market Demand Weakness

December 21, 2012 4:07 PM EST
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O2Micro International Limited (Nasdaq: OIIM) revised its guidance for the fourth quarter of 2012. The company now expects its fourth quarter revenue to be in the range of $16.0 million to $17.0 million, versus previous guidance of $17.0 million to $20.0 million. In addition, gross margin for the fourth quarter is now expected to be 51% to 52%.

The Street sees revs of $18.6 million and loss of 21 cents per share.

The reduction in anticipated revenue for the fourth quarter is primarily the result of broad-based weakness in demand in our end markets, coupled with lower than normal inventories being held in the supply chain.

Sterling Du, Chairman and CEO of O2Micro commented, "We are disappointed by the soft demand in our business in the fourth quarter. We believe this is the result of weak global economic conditions, declining global chip sales and excess inventory corrections by our customers at the end of the calendar year. During this difficult period of revenue weakness, the Company will consider expense reduction measures, including our previously announced intentions to evaluate strategic alternatives for our E-Commerce Group. As we control our expenses, we will protect our investments in our customer facing activities, and continue our efforts to develop innovative technologies and products that we believe will produce our next generation of relevant, competitive products that will drive growth."

No conference call will be held in conjunction with this financial guidance update. Additional information will be available when the Company reports its fourth quarter and full fiscal year 2012 results prior to market open on January 30, 2013.

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