Cirrus Logic Pummeled on Outlook

Cirrus Logic ( CRUS) firmed up its status as a penny stock Friday, losing more then a quarter of its value after saying customers have been dropping orders for chips used in audio and video products.

The Austin, Texas, semiconductor company said the lost or reduced orders will cut revenue to between $58 million and $62 million for the quarter ending Dec. 28, although its expected loss won't be substantially worse than previously estimated. The company, as well as analysts polled by First Call, had been predicting third-quarter revenue about the same as the $73 million it reported last quarter.

On the bottom line, the company will lose 15 or 16 cents a share using standard accounting, and 7 or 8 cents a share before charges. Analysts polled by First Call had been predicting a pro forma loss of 6 cents a share.

The shares were down $1.21, or 28% to $3.05 in the premarket session.

"We have seen a broad range of customers reduce or cancel orders for various audio and video products late in the third quarter," said David D. French, president and CEO. "While we are working to improve our revenue performance, we continue to aggressively reduce the operating costs of our business."

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