Solid-state looks like the place for growth in the chip business.
, which specializes in custom-made flash-memory devices with no moving parts, saw its shares roar higher Tuesday after the company reported explosive first-quarter growth in its enterprise business. It also lifted its guidance for the next quarter.
Shares of the company were trading midday Tuesday at $13.60, up 31%, on heavy volume.
STEC said it made $3 million, or 6 cents a share, in the quarter -- up from $1.8 million, or 4 cents a share, a year ago -- on revenue that grew 25% to $63.5 million.
But it also said that its ZeusIOPS solid-state drives for the enterprise storage market, its core product, turned in brisk sales in the quarter. Shipments of Zeus nearly tripled to $25.7 million from $7 million in last year's first period.
As for its forecast, STEC said it's now expecting EPS of 20 to 22 cents, double the 10 cents that analysts were looking for. On the top line, the company is now forecasting sales of $68 million to $70 million (analysts had been looking for about $59 million), of which Zeus will contribute as much as $65 million, the company said.
Responding to the news Monday, at least one analyst updgraded STEC stock, with Thomas Weisel's Kevin Cassidy hiking his price target to $15 from $6.
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