Palm Beach, FL 5/4/12 (StreetBeat) -- Shares of InvenSense Inc (NYSE: INVN) plunged 25 percent on Friday, after the chipmaker lowered the top end of its first-quarter sales outlook, disappointing investors who had bid up the company's stock price to a life high last week.The company, which makes motion-sensing chips used in smartphones and gaming devices, now expects $38 million to $40 million in revenue for the first quarter of fiscal 2013, down from its previous forecast of $38 million to $42 million.
"A number of our key customers were caught offguard by temporary component shortages associated with a new model of 4G LTE smartphone," CEO Steven Nasiri said on a conference call with analysts on Thursday.
He said the shortages had forced delays in new product releases or lowered outlook at some customers.
InvenSense counts Nintendo Co Ltd (7974) and Samsung Electronics Co Ltd (005930) among its largest customers.
"The issue is a lower-than-expected ramp of new handsets due to the limited availability of Qualcomm Inc's (Nasdaq: QCOM) 8960 chip," Piper Jaffray analyst Gus Richard said in a research note.
He, however, said Qualcomm's chipset had strong wins under its belt and a high attach rate with this chip meant good news for InvenSense in the long term.
Shares of InvenSense, which competes with STMicroelectronics (STM.PA), Sony Corp (6758) and Panasonic Corp (6752), had soared in their market debut last November.
The stock fell to $12.58, their lowest since January, in early Friday morning trading on the New York Stock Exchange. They cut some losses to trade down 21 percent at $13.18 later in the session.
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