ALAMEDA, Calif.-UTStarcom Inc. said its second-quarter financial results reflected both successes and challenges, including increased pricing pressure in China.
“UTStarcom continues to go through a significant transformation as a company,” said Hong Lu, chief executive officer of UTStarcom. “I believe that the next six months will be a crucial transition period for UTStarcom as we integrate all new initiatives into our core business model and emerge as a truly diversified global telecom solutions provider.”
Those new initiatives include the company’s acquisition of TELOS Technology, provider of packet core networks for CDMA2000, and the $165.1 million acquisition of Audiovox Communications Corp.’s wireless assets.
UTStarcom said it has hired a supply-chain consulting firm to help with its supply-chain management to accommodate international demand and its increasingly diverse product portfolio.
For the quarter, net sales grew to $689.6 million, a 70-percent increase from net sales of $405.8 million reported in the year-ago quarter. Net income reached $43.2 million, or 32 cents per share, compared with net income of $39.4 million, or 33 cents per share, for the second quarter of 2003. The company also said it booked approximately $300 million in international contracts in the second quarter.
UTStarcom expects revenues to reach $695 million to $700 million for the third quarter of 2004, $2.95 billion to $3 billion for the full-year 2004, and $4 billion to $4.3 billion for the full-year 2005. The company predicts earnings will be between 34 cents and 35 cents per share for the next quarter, $1.65 to $1.70 per share for the full-year 2004, and $2.20 per share for 2005.
