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News

10 May 2007

 

Finisar cuts revenue forecast due to excess inventories

Finisar Corp of Sunnyvale, CA, USA has cut its guidance for its fiscal fourth-quarter revenue 2007 (to end-April) from $104-110m to about $97m ($88m from optical subsystems and $9m from network testing and monitoring products). This would be 10% down on the prior quarter’s $107.5m and 5% down on $102.4m a year ago.

The downward revision is due partly to:

• the impact of a transition by two customers to ‘lean inventory’ arrangements (whereby demand for Finisar’s products is reduced in conjunction with implementing lower levels of inventory at these customer locations); and
• continued utilization by certain customers of excess inventories of products designed for LAN/SAN (local-area and storage-area network) applications, which adversely affected demand.

These factors combined to reduce revenues from the sale of optical subsystems by about $6m more than previously forecast.

However, revenues from optical subsystems for 10-40Gb/s applications in particular should total $14-15m (in line with its original forecast of $14-$17m).

Revenue for the full fiscal 2007 should now be about $419m, up 15% on fiscal 2006’s $364.3m.

Finisar has also cut the revenues guidance that it gave in early March for its fiscal first-quarter 2008 (to end-July 2007) from $108-115m to $105-112m. Nevertheless, this still represents a revenue rebound from fiscal Q4/2007 due to:

• little or no continuing impact from its customers' lean manufacturing arrangements;
• anticipated increases in sales of products for 10Gb/s applications; and
• a full quarter of results associated with the acquisitions in March of photonic component and subsystem manufacturer AZNA LLC of Wilmington, MA and transponder manufacturer Kodeos Communications Inc of South Plainfield, NJ .

*Finisar says it is not providing preliminary bottom-line financial guidance for fiscal Q4/2007 in light of the voluntary review of its historical stock option granting practices and associated accounting impact, which is ongoing.

Visit: http://www.finisar.com