SAN DIEGO—Wireless modem maker Novatel Wireless Inc. announced a bullish outlook for its second quarter by raising its revenue guidance above $44 million, up from a previous guidance of $40 million to $42 million.
The company’s stock popped up more than 2 percent on the news to almost $11 per share.
Peter Leparulo, Novatel’s chief executive officer, attributed the improved revenue projections to his firm’s diversification strategy and higher sales in EMEA (Europe, Middle East and Africa) and North America. He also mentioned the company’s embedded products for original equipment manufacturers running on both HSDPA and CDMA EV-DO networks.
CIBC World Markets’ analyst Ittai Kidron wrote in a note to investors that the firm expected Novatel’s strong performance. Kidron added that EV-DO growth at Verizon Wireless and Sprint Nextel Corp. is expected to be strong this year, and that Novatel’s comments on HSDPA are “encouraging,” given the analyst’s cautiousness on whether the HSDPA network transition will bring price pressures as has UMTS.
