VANCOUVER, British Columbia-Battling reaction to the profit warning it issued late last week, Sierra Wireless stood out with several announcements at this week’s PC Expo.
Sierra Wireless released its AirPath 300 wireless adapter, which enables wireless data access for the Handspring Visor handheld computer. According to the company, the AirPath 300 is a “natural extension” of the Sierra Wireless AirCard modem line. The Canadian wireless data provider also announced it will provide a removable PCMCIA modem card that will power the new Sony/GoAmerica MYLO wireless service, which allows CLIE monochrome handheld and VAIO notebook PC users access to wireless Internet. Finally, Sierra Wireless officially announced the addition of OmniSky, a provider of wireless applications and services, to the WirelessReady Alliance, a group of industry players working to develop and enhance wireless data solutions.
However, despite the flood of new technology and partnership announcements, the company has not yet bounced back from its recent revised second-quarter guidance report, which it blamed partly on slower-than-expected reaction to its new AirPath 300. In the report, the company reduced its revenue forecast to $18 to $20 million, down substantially from previous expectations of $24 million. Sierra Wireless also said that after one-time charges, it will incur a loss of between $11.8 and $12.5 million, reducing earnings per share to between 73 and 78 cents.
Following the re-released earnings expectations, shares of Sierra Wireless plummeted almost $5, and leveled off at approximately $14 per share on Tuesday afternoon. In addition, research firm Credit Suisse First Boston Corp. downgraded the company’s stock rating to hold, pointing blame at the “softening economy.” The same day, Credit Suisse First Boston also downgraded Novatel Wireless, Sierra Wireless’ largest competitor, to hold, showing further proof of the strains of the slowing economy.
