Magma Design lowers full-year sales outlook

Chip design software company Magma Design Automation Inc. on Thursday forecast a second-quarter loss of 68 cents to 70 cents per share and an adjusted loss of 18 cents to 20 cents per share, on sales of $34 million to $35 million.

For the full year ending May 3, 2009, Magma said it now expects total sales of $158 million to $160 million, a loss of $1.89 to $1.93 per share and an adjusted loss of 15 cents to 19 cents per share.

The company's prior outlook was for sales of $225 million to $230 million for the year, according to a company spokesman.

Magma Design said it is changing its business model so that it will derive 90 percent or more of revenue in any period from its backlog and the rest from transactions completed during the period.

Shares sank 93 cents, or 17 percent, to $4.62 in after-hours electronic trading. The stock had closed up 5 cents at $5.55.