SCIENCE / TECHNOLOGY : FileNet Corp. Expects Third Quarter to Wind Up With a $3.2-Million Loss
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FileNet Corp., a Costa Mesa manufacturer of optical disk data storage systems, said it expects to report a $2.3-million loss for the third quarter, contrasted with earnings of $2.2 million a year earlier.
Security analysts had been projecting a quarterly profit of about $1 million. The financial report, to be released in about three weeks, also will show revenue of $12.5 million, which, the company said, is below previous expectations. For the third quarter of 1987, the company reported revenue of $14.5 million.
The company attributed the expected loss and lower sales to disappointing orders. Many prospective clients have delayed buying the FileNet system in order to a evaluate a similar new IBM product, the company said.
FileNet president and chief executive Ted Smith said that despite the quarterly loss, he believes that the company is well positioned to capture what he hopes will be a rapidly growing market for the data storage system, which records images of documents on optical disks. The system can handle a maximum of 85 million pages. Since being introduced in 1985, the FileNet system has been purchased by a variety of organizations that generate heavy paper work, including finance and insurance businesses, and government agencies.
FileNet stock closed in over-the-counter trading Monday at $7.125 a share, down $2.375 for the day.
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