U.S. Solar company Energy Conversion Devices, Inc. (Nasdaq: ENER) reduced its quarterly guidance yesterday, sending its stock plummeting 25%.
The manufacturer of thin-film solar laminate products announced that it is slowing the pace of its "demand-driven" production and expansion plan to better reflect the downturn in the global solar market.
Due to current economic conditions, the company said its prior 3Q guidance of $95 to $110 million in revenue is no longer applicable. The company said solar product revenue for 3Q will approximate the results from the same period a year ago–roughly $70 million. However, the company said it expects to remain profitable in the current quarter.
Analysts had been expecting revenue of $101.3 million for the quarter ending this month, according to Reuters Estimates. The company also said its full-year forecast of $395 million to $440 million is no longer valid.
ECD shares fell $4.63, or 25.1%, to $13.80 in after-hours trade, according to a Reuters report.
Mark Morelli, ECD’s president and CEO said, "We are prudently slowing down production and expansion plans and are taking immediate action to decrease our spending and to adjust our demand-driven expansion to better align with current market conditions."
The company announced a two-week production hiatus effective March 22. It also said it will postpone hiring until demand improves.
The company is also reducing its workforce by 70 positions through a consolidatioin of of production facilities.
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