Shares of Santa Ana’s STEC Inc., a maker of flash memory drives for server computers and laptops, rose Monday after the company reported second quarter results and gave an outlook for the current quarter that beat Wall Street’s expectations.
The stock was up nearly 5% before ending flat at close of trading. The company counts a recent market value of about $537 million.
STEC reported sales of $56 million, up 29% from the same period a year earlier and ahead of analysts’ expected $53 million in revenue.
Including charges for starting up the company’s Malaysia plant, income tax, stock compensation and other costs, STEC posted profits of $1.5 million, down from $2 million a year earlier.
Without the charges, the company saw profits of $4 million, up from $2 million during the same period a year earlier and in line with analysts’ expectations.
For the September quarter, STEC said it’s looking for profits of $5 million to $5.4 million on sales of $61 million to $63 million.
Analysts are expecting profits of $5 million on sales of $59 million.
The company said it recently landed a design win for a big maker of servers and said it is in the late stages of several other contract bids. It didn’t name the customer.
Earlier this year, STEC said it got a big contract with EMC Corp., one of the top server manufacturers.
“In light of our mounting design win activity at key customers, we believe we will continue to have strong performance into the fourth quarter of 2008 with double-digit growth from the third quarter of 2008,” said Chief Executive Manouch Moshayedi. “This momentum will carry us into the first quarter of 2009 and even beyond.”
STEC’s flash memory drives are found in servers from EMC, IBM Corp. and Dell Inc., and possibly Hitachi Data Systems Corp. and Hewlett-Packard Co.
The company’s shares are up some 40% in the past 12 months.
