Kingston Technology Co., the Fountain Valley-based maker of memory products for computers and consumer electronics, saw a decline in yearly sales last year for the first time in half a decade.
The privately held company on Monday reported 2008 revenue of $4 billion, down 11% from $4.5 billion in 2007.
Kingston doesn’t disclose profits or any other financial details.
The company cited the weak economy and falling prices for memory chips as the top reasons for the dip in revenue.
Kingston, along with others in its industry, got hurt as the market saw a steep drop in prices for memory chips,the building blocks for memory modules made in large part for PC makers such as Hewlett-Packard Co., Dell Inc. and others.
Falling prices for memory chips squeezes profits and lowers the value of the inventory of chips that were already purchased.
“Kingston, like our competitors, was affected by the industry downturn and memory chip saturation of 2008,” cofounder and President John Tu said in a statement. “However, our strong finances and solid cash reserves allowed us to remain nimble and flexible as we adjusted and adapted to the ever-changing market conditions.”
The fourth quarter of last year saw prices for memory chips fall by about 40%, according to data collected by El Segundo-based market tracker iSuppli Corp.
The average selling price of dynamic random access memory,memory chips known as DRAM,are off about 60% for the 12 months through January, iSuppli’s data showed.
Kingston said it plans to “sharpen its focus” on improving efficiency in its operations, cofounder and operations chief David Sun said.
Despite the slumping sales, Kingston said it shipped more products than in 2007, including memory boards for computer makers and flash memory for consumers.
For 2008, the company said it recorded a 41% increase in the number of units shipped over 2007.
Kingston, which got its start in 1987, has some 800 local workers.
