LONDON — Audio chip specialist Wolfson Microelectronics (Edinburgh, Scotland) has warned that fourth-quarter revenues would be up to 25 per cent below market expectations as it feels the effect of a consumer slowdown.

Wolfson's concerns are perhaps the strongest indication yet from a British chip maker that the global financial slowdown will have major consequences for European electronics groups.

The company said that in the past few days it had "experienced a material reduction in order intake and a higher level of rescheduling of orders across a broad range of applications and customers, as they respond to the continued deterioration in consumer confidence."

"This reduction from earlier expectations is the result of the general economic environment and not reflective of any material design loss," Wolfson stressed in a statement Thursday (Oct. 2). This did not stop the shares sliding heavily in early morning trading on the London stock exchange.

The company said it now expected revenues for the fourth quarter would be in the range of $45m-$50m, compared with the market forecasts of around $60m. It added third quarter would be in line with its guidance of $56-$62m, with gross margins steady at between 50 per cent to 51 per cent.

Wolfson's warning also marks a downbeat end to the tenure of Dave Shrigley, who is stepping down as chief executive at the end of the year to return to the US.

Last month, the company said Motorola Inc's Mike Hickey would be taking over as CEO early in 2009.

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