Corel has shocked investors with a profit warning, causing its shares to fall 23 per cent. This comes hot on the heels of its reaching a 52-week stock value high at $44.1625 after rumours of a link with Linux firm, Red Hat. In another sign of its woes, last week saw the reignation of Corel's Chief Financial Officer, Michael O'Reilly.
CEO Michael Cowpland (himself facing insider-dealing charges) attributed the shortfall to problems with its Windows software. The company sees a fourth-quarter loss of 14 cents per share - Wall Street analysts had predicted a profit of 12 cents per share.
Corel has reported earnings of $61 million, against $67.2 million in the same quarter last year. Corel reassures its investors that the problem relates to Windows software sales, rather than its Linux or Mac software.
"While we are disappointed by the preliminary results, we are pleased that we are still able to deliver a profitable year," Cowpland said. "We are confident that our leadership in the exciting, fast-growth Linux market and new Web-based initiatives will put us in good standing for the year ahead."