Nasdaq Chumps....9-01-06

ESS Technology Inc. (ESST) Last Trade:	1.13
Trade Time:	Sep 1
Change:	0.17 (13.08%)

ESS Technology, Inc. (ESST) today announced updated third quarter guidance. The company now expects revenue for the third quarter to be between $23 million and $28 million, below its earlier guidance of $31 to $35 million. Gross margins and earnings are also expected to be below previous guidance.

"The September quarter has been affected by a serious slowing of demand in China for our DVD products which has resulted in lower than expected revenues in the quarter. Our customers tell us that one of the factors affecting this quarter's demand is inventory built in anticipation of the World Cup that has not been depleted and this has impacted their orders for July and August. This is historically very early in the quarter for us to update guidance but it is clear we will not make our previously projected targets. We will provide additional details regarding this quarter's results at our regularly scheduled conference call in October," said Robert Blair, president and CEO.

About ESS Technology

ESS Technology, Inc., designs and markets high-performance digital video processor and imaging sensor semiconductors for the consumer digital entertainment, camera phones and digital home markets. ESS products include highly integrated chips for DVD players, VCD players, digital media players, digital audio systems, and camera phones.

ESS, headquartered in Fremont, California, has R&D, sales, and technical support offices worldwide. ESS Technology's common stock is traded on the Nasdaq National Market under the symbol "ESST."