U.K-based data-storage company Xyratex Ltd. on Tuesday posted a 24 percent drop in its fiscal third-quarter revenue and forecast a net loss for the current quarter, triggering a further sell-off in its stock.
Xyratex's shares took a beating last month when the company warned that its third-quarter revenue would fall more than it had originally anticipated, due in part to weaker demand from several large customers. It also said some of its products failed to meet technical and performance requirements, which delayed sales and further weakened its revenue for the period.
Even so, its quarterly results issued after the close of trading on Tuesday fell well below Wall Street's forecasts.
Xyratex earned $7.7 million, or 28 cents per share, for the quarter that ended Aug. 31. That's compared with $9.7 million, or 32 cents per share, earned in the same quarter last year. After adjusting for share-based compensation and other special items in both periods, it earned 37 cents per share versus 42 cents per share.
Revenue fell to $275.7 million from $361.8 million.
Analysts polled by FactSet had been expecting Xyratex to earn 44 cents per share on an adjusted basis with revenue of $316.3 million.
CEO Steve Barber said Tuesday that the third quarter was "very challenging." He said that Xyratex has been able to resolve most of its technical and performance issues with its latest products and is working to resolve remaining issues.
The company said it expects to post an adjusted loss of between 15 and 43 cents per share for its fourth quarter. It forecast revenue in the range of $235 million to $285 million for the period.
Analysts polled by FactSet had been expecting the company to earn 49 cents per share on revenue of $327.9 million for the period.
Xyratex's stock fell $1.27, nearly 15 percent, to $7.43 in extended trading on the news. It had ended the regular trading session down 49 cents, or 5 percent, at $8.70.
As of Tuesday's regular-session close, Xyratex's stock was down 35 percent for 2012.