Storage Dimensions Inc, Milpitas, California disk subsystems integrator, is warning that it will report a second-quarter loss on revenues down 10% to 15% from the first-quarter total of $20.9m. Salomon Brothers cut the company’s stock to buy from strong buy and figures the loss should come in at about $0.07, compared to original estimates of $0.17 per share in earnings. The company offers a host of excuses for the shortfall, including softness in the PC-LAN market, price erosion on disk drive components, an understaffed sales force and the cost of rolling out it new RAIDPro product. Gross margins are expected to be between 34% and 35%, down from 36.4% last time, and operating expenses should rise 5% to 8% from the first-quarter total of $6.6m. Shares in the company plunged with the bad news, closing down $3.9375, or more than 38%, at $6.3125 on Friday.
