OCZ Technology Group's new CEO, Ralph Schmitt, said during an interview on Thursday that the SSD company has finally gotten "the train back on the track", taking a jab at one analyst's recent description of the company as a "train wreck".
OCZ has taken a ride on a virtual roller coaster over the past several months, starting with founder and CEO Ryan Peterson stepping down from his position in September. Not long after that, the company warned that it expected 2nd quarter revenue to be below its prior forecast due to a shortage of NAND chips. The company then said it expected a "significant" loss during the same quarter thanks to issues surrounding its "customer incentive programs".
Adding to that, OCZ still hasn't filed its 2nd-quarter results to the Securities and Exchange Commission. This is reportedly due to a third-party review of OCZ's investigation into customer incentive programs which has taken longer than expected. So far it's unclear as to when the company will release the results, and even the company's new CEO has no clue as to when those numbers will be released.
Despite the 2nd quarter filing issue, Schmitt indicated that things are looking up for the SSD company. For starters, OCZ is now using multiple NAND vendors instead of just one primary source. "We diversified ourselves to multiple suppliers," he said. "That was part of the issue before. We were overly reliant on one supplier."
He also said the company, which had to dip into its cash facility in October, was in talks for additional capital. "There is ongoing discussion," he said. "We've plenty of interested parties. I don't think it'll be an issue for us to get cash into the company. It's a question of what the terms look like."
What OCZ doesn't plan to do in the near future is sell out to another company. Still, an outright sale is one of many strategic alternatives, and the company is open to exploring all avenues. "Right now [a sale is] not the direction we are heading towards because we believe the valuation of the company today should be higher even if based on the pure assets of the company," he said.
OCZ shares spiked in July thanks to reports that both Seagate and Micron had an interest in purchasing the company. But from the period between October 10 and the market close on Wednesday, shares fell a frightening 57-percent. OCZ plans to up its valuation by dumping around 150 lower-end products so that it can focus on its more-profitable products. The company reportedly hasn't made a profit in the last three quarters.
"I cannot think we can compete on price," he said. "The flash guys - the Microns, the Intels, the Samsungs really are the guys that will take that market. They can have it as far as I am concerned, as there is no profit to be made there for us."
OCZ also plans to keep a little money in its pocket by slashing its workforce by about 28-percent – around 700 workers were employed with OCZ as of February 29, Reuters said. Combine that with the closure of product lines and pushing out older inventory, OCZ should see better numbers over the next few quarters.
"We are cranking up the speed here, moving forward on those [train] tracks," Schmitt said.
Stay on the Cutting Edge
Join the experts who read Tom's Hardware for the inside track on enthusiast PC tech news — and have for over 25 years. We'll send breaking news and in-depth reviews of CPUs, GPUs, AI, maker hardware and more straight to your inbox.
great to hear! I'm still not buying shares until after Dec 12 though!!Reply
Wow that is totally amazing clarke thorell! You own a supercar worth millions and you have only been in your job for four months! I am totally going to click on that not even one bit inconspicuous link and then I can make all the money in the world!!! Heck I might even start up a business involving 'cams' and young girls while I am at it!Reply
Dingo07great to hear! I'm still not buying shares until after Dec 12 though!!Reply
Why is that? Just curious, as I may also be interested...
Trainwreck is still going, every single illendex drive I have purchased from OCZ has failed!Reply
Got a 120GB solid to return today, wont read at all, just like the dozen plus other failed ocz drives. Never again!
"Everything's great," says OCZ CEO as he delays revealing his 2nd quarter finance report, lays off 1/3 of his workforce, and entertains offers to sell his company.Reply
I was trying to snag the stock once it got to $1...it got down to 1.11 and shot back up to 1.67 :( Go back down please!Reply
hows about making an SSD that doesnt need an update or 12 to workReply
OCZ - working all the time, 10% of the time
Their last couple high performance offerings in the consumer line are reliable, great drives... the Vertex 4 and Vector. I grabbed a 256GB Vector and it is phenomenal. OCZ just needs to keep in the high end on not go back to cheap value offerings.Reply
ocz's problem is their drives fail very quickly if they even work at all it's about 1-20 that are bricks right out of the box and another 1 in 4 that crap out in the first 3 monthsReply
Absolutely great to hear they have multiple suppliers! That way they can advertise the highest speed from the chips that.work best with the controller, while selling a mixed bag that gets mixed results! That will fix their bad reputation!Reply