Equipment maker Alvarion (Tel Aviv, Israel) has warned investors that its third-quarter revenues are likely to come in at $27 million, significantly below the range of $31–39 million it was previously expecting.
As a result, the vendor is likely to report a net loss per share of approximately $0.15. It had previously forecast that net income would range between a loss of $0.06 and a profit of $0.02.
The Israeli company blames the predicted revenue shortfall on the postponement of shipments from the current quarter until the final quarter by two major customers – one from Latin America and one from central and eastern Europe.
Further pressure came from the postponement of a significant order by a carrier WiFi customer based in Africa.
In addition, Alvarion faces a one-time charge of $2.5 million from the shutdown of Main Street Broadband (Atlanta, USA), a former WiMax customer.
“Despite this unexpected setback in achieving our financial targets for the third quarter, we believe that the company’s turnaround plan remains on track and that we will reach at least breakeven operating cash flow and modest profitability by year end,” said Hezi Lapid, the president and chief executive officer of Alvarion, in a statement.
“Notwithstanding the delay in shipments, our carrier licensed business is performing well, and we are particularly pleased with the market acceptance of the newest addition to our licensed offering – the BreezeCOMPACT. In just five months since the product was launched, we received orders valued at order $10 million.
We are also seeing traction for our carrier WiFi solution, with recent deals from additional Tier 1 carriers in Asia Pacific,” he said.
The company has also announced the sale of a portion of its 4G patents portfolio to Wi-LAN Inc (Ottawa, Canada) for about $19 million.
“This transaction will support our cash needs and allow us to make the investments necessary to execute our turnaround plan and put Alvarion on a path to sustainable growth and profitability,” said Lapid.