STEC Shares Got Crushed: What You Need to Know

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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of hard-drive maker STEC (NAS: STEC) are getting crushed today, down by as much as 21%, after the company reported quarterly earnings last night.

So what: Third-quarter revenue spun up to $72.5 million, and earnings per share added up to $0.14. While the results beat the market's expectations of $70.7 million in sales and earnings of $0.10 per share, the company issued revenue guidance that came up way short.

Now what: Fourth-quarter revenue is expected in the range of $55 million to $57 million, well below the $72.6 million consensus, which may result in non-GAAP breakeven or a loss of $0.02. STEC attributed the slow adoption of solid-state drives, or SSDs, to the challenging environment, as current prices remain prohibitively expensive. There's no doubt that SSDs will displace spinning-disc hard drives and that the opportunities will be massive once the adoption is in full swing; the only question is how long it will take.

Interested in more info on STEC? Add it to your watchlist byclicking here.

At the time this article was published Fool contributorEvan Niuholds no position in any company mentioned.Click hereto see his holdings and a short bio. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.

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