SYNA down in sympathy due to weakness in competitor, Fingerprint Cards, a Swedish company. Investors apparently selling SYNA on concerns that the entire industry is showing weakness, although Fingerprint Cards said they are losing market penetration. Maybe SYNA is taking it from them?
STOCKHOLM, March 21 (Reuters) - Shares in Fingerprint Cards (FPC) plunged as much as 42 percent on Tuesday after the former stock market star scrapped plans to pay a dividend and said it could not forecast likely earnings for 2017.
The Swedish company, which as its name suggests provides fingerprint sensors for technology products, blamed weaker demand from smartphone makers and inventory build-up for the warning.
It has been losing its dominant market position as more companies switch to using two or three suppliers rather than relying solely on its products.
FPC has 20-30 competitors globally and its main rivals include China's Goodix, Silicon Valley-based Synaptics and Taiwan'sEgis Technology.
Carnegie analyst Havard Nilsson warned that FPC's revenue might decline this year after growth of around 130 percent in 2016 and over 1,100 percent in 2015.
"It seems unlikely the weakness is explained only by high inventory as competition is increasing from Goodix, Silead, Elan and Idex," said Nilsson, who has a "Sell" recommendation on the stock.
FPC revenues could fall to between 4 billion and 6 billion Swedish crowns ($455-683 million) this year versus 6.6 billion in 2016, he added.....
Chief Executive Christian Fredrikson, who took charge last August, acknowledged tougher competition but sought to reassure investors.
"That's the name of the game - I think that will continue and there's nothing else to do about it. But we feel we are in a strong position to defend our market leadership," he told a telephone conference.
The company also lowered its forecast on market share for 2017 to around 50 percent from a previous estimate of above 50 percent. That compares with between 55 and 60 percent in 2016.
The 20-year-old firm had its big breakthrough in 2015 when demand for fingerprint sensors in smartphones and tablets soared after other manufacturers followed the lead of Apple, which bought its own sensor maker, AuthenTec, in 2012.
