Creative forecasts Q3 sales drop

A last minute Christmas rush helped Creative Technologies beat analysts expectations for Q2, but profit still fell 40 per cent to $26.5 million, down from $44.5 million a year ago.

But for the quarter ending 31 March, Creative has forecast sales to slump down to between $260 million and $270 million, compared with $330 million a year earlier. The company has said there may be job cuts in the period.

Creative blames weak orders from PC vendors, especially Dell, for the Q2 results and the pessimistic Q3 forecast.

Revenues for Q2 fell 2.2 per cent to $427 million, from $436.8 million a year ago.

Good sellers at Christmas were the SoundBlaster range and the Nomad Jukebox. Entertainment products accounted for 12.7 per cent of sales in Q2, from 4.7 per cent a year ago. Sound cards accounted for 35.7 per cent of sales for Q2, down from 38.5 per cent a year ago. ®