Network Associates has warned of fourth quarter losses of between $130 million and $140 million, while losing its three top execs.
The antivirus software maker blamed unsold inventory and a general sales slowdown for the slump. It expects revenues for the quarter ending December 31 of between $55 million and $65 million - largely due to distributors deciding to "dramatically" cut their own inventory levels, as well as falling demand for products, it said yesterday.
Just two months ago the California company had forecasted sales of up to $250 million and profit of up to 32 cents per share.
Network Associates also announced several management changes - it is losing its chairman and CEO William Larson, and CFO Prabhat Goyal. Both Larson and Goyal will be off as soon as replacements are found, which in Larson's case is expected to be by the end of February.
Company president Peter Watkins leaves the company at the end of the week. Director Edwin Harper has taken over as chairman.
In a statement, Network Associates said: "The company further believes that the lower fourth quarter demand is not related to the general competitiveness of its products but is due to concerns about the state of the economy from the customer base." ®