Oak Technology Announces Results, Restructuring
Oak Technology (Sunnyvale, CA) announces Q2 '98 financial results. Revenue of $49.4 million represent a 4% increase over Q2 '97. A net income of $7.6 million compares with a net income of $13.2 million in Q2 '97. Q2 '98 net income includes $4.8 million resulting from a favorable legal settlement. Oak's Optical Storage business accounted for 80% of the company's Q2 '98 revenue. Oak warns that pressure from new competitors and the sub-$100 PC segment for lower-cost components, along with the economic turmoil in Asia, may result in a net loss for Q3 '98. Oak has also announced restructuring plans, including the refocusing of its attention on three key markets and the divestiture of its PC audio and graphics interests. Oak will concentrate on its Optical Storage, Consumer Electronics and Digital Office Equipment, which comprises an overwhelming majority of its business interests. Oak has also named Richard Black as president, and Oak's board of directors has authorized the repurchase of up to 2 million shares of its common stock.