STOCKHOLM (Reuters) - Smartphone component maker Fingerprint Cards FINGb.ST (FPC) warned revenue would be far below market estimates in the third quarter as the industry switches to cheaper user-recognition technology, sending its shares tumbling 22 percent.
The Swedish company, which makes fingerprint sensors used to unlock smartphones, has suffered from industry-wide over-supply. Now, larger clients are switching to back-mounted sensors that sell for less than those activated by touching the Home button.
FPC said average selling prices for sensors have fallen by around 30 percent, versus a previous forecast of more than 20 percent. It said the industry had also turned more cautious ahead of Apple’s iPhone X launch last week, dampening demand.
“Fingerprints is currently experiencing a cautious market and one contributing factor is Apple’s launch,” FPC said in a statement on Monday. It also blamed a weaker U.S. dollar.
The company now sees third-quarter revenue of between 800 million and 840 million Swedish crowns ($100-105 million), compared to 823 million crowns in the second.
Analysts were previously expecting revenue of almost 1.5 billion crowns, Thomson Reuters Eikon data shows. It had warned on profits three times since the end of 2016 and abandoned giving revenue forecasts.
Apple’s iPhone X includes hardware for facial recognition instead of a fingerprint sensor to unlock the phone. Some analysts say this is bad news for Fingerprint Cards, though others believe it is too early to tell.
The company makes fingerprint and iris detection technology, but not facial recognition.
Chief Executive Christian Fredrikson told analysts and media on Monday that it was too early to say if FPC would lose market share because of the iPhone X launch.
Reporting by Olof Swahnberg and Helena Soderpalm; editing by Jason Neely and Tom Pfeiffer
Our Standards: The Thomson Reuters Trust Principles.