In a statement released after market close Wednesday, Mellanox said that it expects fourth-quarter revenue between $119 million and $121 million, below its previous guidance of $145 million to $150 million.
Investors responded negatively to the reduced outlook, pushing the company's shares down 18.78% to $49.70 in premarket trading. Mellanox's stock closed up 3.05% during the first day of 2013 trading on Wednesday.
"The shortfall is primarily the result of a weaker demand environment, challenging macroeconomic conditions, and a technical issue associated with FDR 56Gb/s InfiniBand cabling which caused approximately $20 million of FDR deployments to be delayed," explained Mellanox, in a statement.Mellanox added that the cabling issue has been resolved and is not expected to impact revenue in the future. The company expects annual revenue of $500 million, up from $259 million in 2011. Allot Communications (ALLT - Get Report) was another laggard, tumbling 6.51% to $17.09 on Thursday. The networking specialist's shares ended Wednesday's session up 2.58%. Facebook (FB - Get Report) shares dipped 0.61% to $27.83 before market open on Thursday, after gaining 5.19% on Wednesday as tech stocks were lifted by the deal to avert the so-called fiscal cliff. Apple (AAPL - Get Report) shares slipped 0.56% to $545.97 in premarket trading, after closing up 3.17% on Wednesday. HP (HPQ) shares were off 0.87% at $14.89 on Thursday, despite rising 5.4% during Wednesday trading. Microsoft (MSFT - Get Report) shares, which gained 3.41% on Wednesday, were off 0.25% at $27.55 in premarket trading. Shares of networking giant Cisco (CSCO - Get Report), however, gained 0.49% to reach $20.44 before market open, after gaining 3.51% on Wednesday. Chinese Internet giant SINA (SINA - Get Report) was another gainer, rising 0.63% to $52.60, while daily deals site Groupon (GRPN - Get Report) gained 0.6% to $4.99. Online travel specialist Priceline (PCLN - Get Report) rose 1.74% to $649.50 before market open. --Written by James Rogers in New York. Follow @jamesjrogers >To submit a news tip, send an email to: firstname.lastname@example.org.