Alliance Semiconductor told investors its financial results in the current quarter will be significantly below levels recorded in the first three months of this year because of continued weakness in dynamic RAM (DRAM) devices.
In the quarter ending June 27, San Jose, Calif.-based Alliance ALSC said its revenues are expected to fall well below the $28.3 million reported in the previous three-month period, ended March 28. The memory supplier added it expects a net loss for the current quarter, including a pretax charge for a reduction in inventory value. In the previous quarter, Alliance reported a net profit of $0.1 million, or 0 cents per share.
"Primarily due to unexpectedly dramatic DRAM price declines, we will not meet expectations for the quarter," said N.D. Reddy, president and CEO of Alliance. "Since DRAM currently makes up the majority of our revenues, our business has been greatly effected by the significant price declines."
The company is now attempting to reposition itself to reduce its "exposure to DRAMs and commodity memory products," Reddy said. "These changes, however, will likely take the balance of this calendar year. Pricing visibility is expected to remain limited until then."
In addition to DRAM devices, Alliance supplies static RAM devices, flash memory, multimedia graphics accelerators, and integrated circuit products with embedded functions. In Alliance's last fiscal year, ended March 28, DRAM devices accounted for 66 percent of its $118.4 million revenues; SRAM devices, 27 percent; and graphics, 7 percent. The company suffered a net loss of $5.7 million in 1998.