EVERETT – Intermec Inc. said Wednesday that falling sales of its hand-held computers and bar-code scanners will result in a $50 million drop in estimated sales for the third quarter.
“It is clear … at this point that our sales shortfall from prior guidance will be substantial,” Larry Brady, the company’s chairman and chief executive officer, told investors Wednesday afternoon.
In light of the sudden decline, the Everett-based company will look at cutting costs in the coming months, Brady added. He did not elaborate, and company representatives could not be reached late Wednesday to comment on the possibility of layoffs.
Last year’s third quarter brought in sales of $220 million, and Intermec earlier forecasted that would improve to $230 million or $240 million for this year’s same period.
Instead, revenue will probably total between $192 million and $196 million, an 11 percent decline compared with last year.
Brady cited three possible contributors to Intermec’s stumble in the just-ended quarter.
First, the company unveiled its new product lines last month, including the replacement for its best-selling 700 series of mobile computers for use in warehouses and other inventory-tracking environments. As a result, some customers may have delayed their orders until the new products are available.
More ominously for Intermec, some of the decline could be due to more aggressive moves by competitors, Brady said.
Lastly, he mentioned customer worries about an economic slowdown, saying the last time Intermec experienced such a fall was at the leading edge of the last recession.
Sales in North America and Europe, the Middle East and Africa have fallen by 15 percent compared with last year, Brady said. The rest of the world, including Asia, brought in gains of 20 percent, but that’s a smaller market for Intermec at present.
The only products selling better in the third quarter than last year are Intermec’s small printers and related products.
Shares of Intermec, one of the two largest public companies based in Snohomish County, rose 54 cents Wednesday to $26.31. After the market closed trading for the day, Intermec made its announcement, sending the stock price reeling downward by 20 percent, or more than $5 a share.
Brady said the firm will know more and comment more extensively on its plans when it officially releases third quarter results Nov. 1.
Reporter Eric Fetters: 425-339-3453 or fetters@heraldnet.com.
Talk to us
> Give us your news tips.
> Send us a letter to the editor.
> More Herald contact information.
