Autonomy shares crash after profit warning

Confidence in the technology sector has taken a plunge after software manufacturer Autonomy saw its shares shares fall by nearly 60 per cent.Confidence in the technology sector has taken a plunge after software manufacturer Autonomy saw its shares shares fall by nearly 60 per cent.

The company, which makes software to automate business management functions, had issued a profit warning after finding its first-quarter sales did not reach analysts' forecasts.

Its shares in London fell as much as 335 pence to 235p. The company has lost 83 per cent of its value this year due to fears that sales at the company, which does about half its business in the US, may be hurt by that country's economic slowdown.

"It's really a surprise," said Boris Boehm, a fund manager at Nordinvest in Hamburg, who holds Autonomy shares.

Autonomy's large customers in Europe unexpectedly delayed purchases in the last two weeks of the quarter as they became more cautious about the economy, Chief Executive Mike Lynch said in a statement after US trading ended yesterday.

Europe had been a stronghold for many software companies that have lowered forecasts because of weak demand in the US.

The company, whose software automatically links related pieces of information on computer networks, on audio archives or on Web sites, yesterday said estimated sales were about $14 million to $15 million compared with forecasts of $24 million.