SEATTLE (AP) ¿ Digital-storage company Isilon Systems Inc. said Monday it expects a first quarter loss, steeper than Wall Street anticipates, and plans a 10 percent work force cut to reduce costs by about $4 million a year.

Shares of the Seattle company fell sharply for a second straight trading session, following criticism from analysts Friday that the company's 2008 outlook lacked clarity. Its shares declined 31 cents, or 12.7 percent, to $2.14 in midday trading.

The company said it expects a loss of between 16 cents per share and 17 cents per share including items for the period ended March 31. It expects earnings before items between 14 cents per share and 15 cents per share.

Both estimates include a non-cash inventory write-down of about $3.8 million, or 6 cents per share.

Analysts surveyed by Thomson Reuters expect a quarterly loss of 12 cents per share. These estimates typically exclude items.

Isilon anticipates revenue of $26.5 million to $27 million, up from a year ago but down sharply from the fourth quarter. Analysts were looking for revenue of $27.4 million.

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