(Refiled to correct dateline to read STOCKHOLM, not LONDON)
* Slashes 2016 revenue forecast to 6.6-6.8 bln SEK
* Inventory build-up main reason for cut in 2016 forecast
* Sees 2017 revenue of 7.5-9.5 bln SEK
By Olof Swahnberg
STOCKHOLM, Dec 8 (Reuters) - Biometric technology firm Fingerprint Cards (FPC) has slashed its revenue forecast for this year after overestimating demand for its touch sensors in smartphones, sending its share price down by over 10 percent.
The 20-year-old Swedish firm had its big break-through in 2015 as demand for fingerprint sensors in smartphones and tablets soared after other manufacturers followed the lead of Apple, which bought its own sensor maker, AuthenTec, in 2012.
But FPC, whose customers are mainly Chinese smartphone makers such as Huawei and Oppo, said on Thursday it now expected 2016 revenues of 6.6-6.8 billion Swedish crowns ($730-752 million) instead of a previous forecast of 7.2-7.5 billion crowns.
Its shares were down 12 percent at 65.90 crowns by 1035 GMT, a fall of over 40 percent this year due to worries about growing competition.
“We will have to get better into understanding what is the full inventory across the whole (supply) chain,” Chief Executive Christian Fredrikson said.
“There are many players in this chain and we are kind of at the start of it, so I think that is a reason why we just missed this one.”
FPC, which competes with the likes of China’s Goodix and Silicon Valley-based Synaptics, got a headstart on newer rivals with a twelve-fold rise in revenues last year, to 2.9 billion crowns, and its shares soared more than 1,700 percent.
But the company started to see problems in October this year with inventory build-up for smartphone components such as fingerprint sensors, and in November the situation got much worse, Mattias Eriksson, head of FPC investor relations, told Reuters.
Lower smartphone volumes, due to shortages of some components, and stiffening competition also weighed on 2016 sales, the company said, adding that it expected these factors to also affect revenues in the first quarter of 2017.
The company also reduced its market share expectations for 2016, to “clearly above 50 percent” from around 60 percent previously.
Fredrikson said the company also expected “some” further market share losses in 2017.
Redeye analyst Joel Westerstrom said the revised revenue forecast had hit market confidence in the company but he thought it was a temporary weakness and that the company should be able to increase revenues to around 9 billion crowns in 2017.
FPC said it expected revenues next year of between 7.5 and 9.5 billion crowns, which compared with the average of analysts’ forecasts of 8.6 billion crowns, according to Thomson Reuters SmartEstimate.
The company also predicted an operating margin of at least 35 percent in 2017, lower than its unchanged forecast of about 40 percent for 2016. Analysts had forecast a margin of 37.7 percent according to a Reuters poll. ($1 = 9.0411 Swedish crowns) (Editing by Greg Mahlich)