Will 2007 be a bad year for flash memory manufacturers??
If SanDisk’s stock price is of any indication, 2007 is going to be a bad year for flash memory manufacturers. On Friday, SanDisk shares took a nosedive, dropping roughly 20% in afternoon trading following its third-quarter earnings announcement. Once the market opened today shares of SanDisk continued to move south and is trading down $0.78 (1.60%) this this morning.
SanDisk expects a pricing decline of 15% to 20% in the fourth quarter. Some analysts have expressed concern that the market for NAND flash memory, which can store data without access to power and is used in devices like MP3 players and cell phones, will be oversupplied. “Pricing turned out to be worse than expected and while management and the company did a good job in terms of execution and lowering their cost structure?folks were hoping for gross margin improvement and potentially a substantial lift in margins in the fourth quarter.
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