Corel sees $32 million loss
The software maker says an accounting change will result in a $32 million loss for its third quarter.
Corel was expected to post earnings of 3 cents per share, according to a First Call estimate, for its third quarter ending September 24. Corel shares closed today at 5-5/8, down nearly 13 percent.
Corel shipped orders totaling $96 million in the third quarter but took in only $54 million in revenues, according to a statement issued today.
Analysts say the discrepancy resulted from a lack of sales through resellers to end users.
"Seems that the accounting change is being dictated by realities of the market--they are shipping more into the channel than is selling through," said Steven Frankel, an analyst with Adams Harkness in Boston. "So inventory is building up in the channel."
The company also reported that cash levels at the end of the third quarter will remain at about $20 million, the same level as at the end of the second quarter.
Corel reported earnings of 6 cents a share for the second quarter ended in May and a jump in revenues of 15 percent from $87.5 million to $100 million.