Silicon Storage Technology (Nasdaq: SSTI) rose63 U.S. cents to $8.49 in morning trading Monday after the company, whichmakes semiconductor components, reported first-quarter results that beat itspreviously lowered expectations and said demand for its products isbeginning to pick up.
Sunnyvale, California-based SST said that revenue for the quarter ended March31st totaled $86.3 million, up from $62.3 million in the year-earlierquarter. Net income totaled $5.4 million, or 6 cents per share, including awritedown of inventory that cut earnings by 3 cents. In the year-earlierquarter, net income totaled $9.6 million, or 11 cents per share.
“This quarter we experienced a significant slowdown in our business as aresult of deteriorating domestic and international economies and inventorycorrections that continue to constrain demand for technology products,” saidpresident and chief executive officer Bing Yeh.
A “sharp downturn” that began late last year continued through the firstquarter, though “the situation has improved slightly since March,” thecompany said. Second-quarter revenue and earnings are likely to be 5 to 10percent better than first-quarter levels, SST said.
“Despite the market slowdown, we are continuing our strong focus on thedevelopment of new products and the cost reduction of existing products,”SST said.
Added Yeh: “We are confident in our belief that SST will be able to weather the currentgloomy macroeconomic climate.”
According to Yeh, SST is “well positioned to emerge from this cycle a stronger and more dominant player in the global flash memory market.”
Last month, SST lowered itsoutlook for the quarter, saying a “deteriorating economy and inventorycorrections” were hurting demand for its products.