DuPont's stock dives toward a 6-month low as weak consumer demand for electronics leads to a lowered full-year earnings outlook.
Shares of DuPont de Nemours Inc. took a deep dive Tuesday, after the technology-based materials and plastics company lowered its full-year outlook, as weakness in the consumer electronics markets is seen continuing for longer than previously projected.
The company, with brands including Kevlar, Corian, Tyvek, Styrofoam and Riston, reported before the open first-quarter profit and sales that fell from the same period a year ago but still beat expectations. Chief Financial Officer Lori Koch said on the post-earnings conference call with analysts that first-quarter volume declined 7% from a year ago, amid weakness in electronics resulting from “decreased consumer spending,” as well as channel inventory destocking and softness in construction markets.
Koch added that sales in its semiconductor technologies business fell in the “midteens” percentage range, resulting from reduced semiconductor fab utilization rates, “due to weak end-market demand,” as well as from the destocking of finished chip inventories. Chief Executive Officer Ed Breen said given the weakness in semiconductors started at the beginning of the fourth quarter, meaning it has now lasted for two full quarters. “Now we think the quarter we’re in now is the bottom, just slightly down more from the first quarter,” Breen said.Meanwhile, the company did see growth in its water and protection business, with first-quarter sales up 1.4%, helped by higher pricing and continued demand growth for water filtration products.
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