OCZ Technology Q1 Loss Narrows, Stock Rises - Update

(RTTNews) - OCZ Technology Group, Inc. (OCZ), a provider of high-performance solid-state drives for computing devices and systems, Monday reported a narrower loss for the first quarter, helped by lower costs.

For the first quarter ended on May 31, net loss narrowed to $13.2 million or $0.19 per share from $24.5 million or $0.36 per share in the previous year. In the previous quarter, the company's net loss totaled $21.1 million or $0.31 per share. Prior-year results have been restated.

Adjusted net loss was $9.7 million or $0.14 per share, while it totaled $29.4 million or $0.44 per share last year.

Revenue for the quarter dropped to $55.32 million from $76.49 million in the previous year and $69.67 million in the preceding quarter.

Cost of revenue fell to $47.22 million from $84.9 million. Total operating expenses dropped to $19.71 million from $22.98 million.

Ralph Schmitt, CEO of OCZ, said, "Revenue generated from our enterprise solutions for the first quarter more than doubled compared to the last quarter, and drove the sequential gross margin increase. Overall revenue declined about 20% sequentially, primarily due to the lack of NAND flash supply for our client SSD products."

The company plans to file its second-quarter results for fiscal 2014 by the required date of October 15.

"In the first half of our fiscal year, we faced significant challenges securing flash. We believe that flash availability and pricing was impacted by our credit situation due to our restatement efforts. This especially came to light in the second quarter," Schmitt said.

Preliminary revenue for the second quarter is estimated to decrease to between $30 and $35 million with a significant sequential reduction to gross margins. According to the company, the NAND supply constraints and costs more significantly impacted its client revenue and margins.

OCZ closed down 2.8 percent on Monday at $1.41, but gained 5 percent in the extended trade.