SanDisk shares fall 33% after earnings call

Terrible day for SanDisk (NASDAQ:SNDK) shareholders after the company posted a loss of $155 million in Q3 2008 on a drop in revenue as excess inventory forced it to cut prices.  Shares are now in the $10 range.

The company said after the market closed it posted a loss of of 69 cents a share. Excluding charges, the company posted a loss of $132 million, or 59 cents a share. Analysts were expecting, on average, a loss of 27 cents per share. These estimates typically exclude items.

A year ago, SanDisk earned 36 cents per share. Revenue came in at $821.5 million, beating expectations of $778.1 million. That might be something to celebrate but investors could care less when that comparies to revenue down 21%  from last year.

SanDisk said earlier in the day it will sell Toshiba Corp. about 30 percent of the manufacturing capacity of their joint ventures. SanDisk expects to receive cash and reduce equipment-lease obligations by about $1 billion with the deal.

In the latest quarter, SanDisk took $109 million in charges on excess inventory and the pricing pressures that created, Eli Harari, chairman and chief executive, said in a statement.

He said the company is helping its balance sheet by restructuring its joint ventures, cutting some 2009 capacity and implementing large expense reductions for fiscal 2009.

Last month, SanDisk rejected a $26-per-share offer from Samsung Electronics Co. but left open the possibility for further negotiations if the bid were raised. The stock has dropped steadily since then.

Since January SNDK shares have lost 69% of their value and with tough economic conditions, expect more downgrades, SanDisk could keep falling.