Creative Technology

(CREAF)

hewed its loss in the fourth quarter from a year ago, but revenue fell almost 25%.

The Singapore-based company late Wednesday said it lost $12.7 million, or 15 cents a share, for the quarter ended June 30, compared with a loss of $31.9 million, or 38 cents a share, in the same period last year.

Creative, which makes MP3 players, said quarterly revenue dropped to $230.9 million compared with $305.4 million a year ago.

Sales for the 2006 fiscal year were $1.1billion, compared with $1.2 billion for the previous fiscal year.

Excluding an investment gain, net loss for the same quarter last year was $41.2 million or 49 cents a share.

Creative Labs President Craig McHugh said that the company reduced its operating expenses by 17% from the previous quarter and "further reduced our net inventory level in the period, with a 15% decrease from the previous quarter."

Additionally, he said that Creative made progress toward its goals "launching the Zen V, and the Zen V Plus MP3, photo and video player in the period."

In May, Creative sued rival

Apple

(AAPL) - Get Report

in federal court and

filed a complaint against the iPod maker with the U.S. International Trade Commission.

The actions charge Apple with violating Creative's patent on a user interface which navigates and accesses songs stored on an MP3 player.

Shares of Creative traded up 2 cents to $5.30 in the regular session.