Creative expects operating loss this quarter

Digital music player Creative warned it expects an operating loss of up to US$65 million for last quarter due to a sharp drop in prices of flash memory chips.

Digital music player, Creative Technology, expects to post an operating loss of up to $US65 million during the three months ending March 31.

The company blamed a sharp drop in prices of flash memory chips for the loss.

Prices of flash memory chips plunged in March as consumers bought fewer digital music players, yet chipmakers increased production of the chips.

The good news for users has been falling flash memory prices on global chip markets, which should lead to bargains for flash memory cards used in digital cameras or other devices, and digital music players in late April or May. Companies normally respond to falling flash memory prices by either increasing the amount of storage capacity in devices, or slashing prices -- especially on older models.

Creative, in Singapore, expects its revenue to be between $US220 million and $US230 million during the third quarter of its financial year.

The price of the most widely used NAND flash memory chip, 2Gbit chips, had dropped 34 per cent to $US5.67 on Tuesday from $US8.55 at the beginning of March, according to industry researcher DRAMeXchange Technology. Since the beginning of this year, the price of 2Gbit chips has fallen 63 per cent to Tuesday's close, from $US15.13 on December 30.

Other companies have been feeling the bite of plunging NAND flash memory prices.

Lexar Media, a developer of NAND devices, updated its earnings forecast last week for the quarter ending March 31 to a level far below estimates. The company expects revenue for the period of up to $US130 million, with a $US30 million loss, compared to analysts' estimates of $US200 million in revenue and a $US16 million loss.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Dan Nystedt

IDG News Service
Show Comments

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Jack Jeffries

MSI GS75

As the Maserati or BMW of laptops, it would fit perfectly in the hands of a professional needing firepower under the hood, sophistication and class on the surface, and gaming prowess (sports mode if you will) in between.

Taylor Carr

MSI PS63

The MSI PS63 is an amazing laptop and I would definitely consider buying one in the future.

Christopher Low

Brother RJ-4230B

This small mobile printer is exactly what I need for invoicing and other jobs such as sending fellow tradesman details or step-by-step instructions that I can easily print off from my phone or the Web.

Aysha Strobbe

Microsoft Office 365/HP Spectre x360

Microsoft Office continues to make a student’s life that little bit easier by offering reliable, easy to use, time-saving functionality, while continuing to develop new features that further enhance what is already a formidable collection of applications

Michael Hargreaves

Microsoft Office 365/Dell XPS 15 2-in-1

I’d recommend a Dell XPS 15 2-in-1 and the new Windows 10 to anyone who needs to get serious work done (before you kick back on your couch with your favourite Netflix show.)

Maryellen Rose George

Brother PT-P750W

It’s useful for office tasks as well as pragmatic labelling of equipment and storage – just don’t get too excited and label everything in sight!

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?