Brightpoint earnings double, but continued carrier consolidation may hurt

In the second quarter, Brightpoint Inc., racked up a 55% jump in revenues and doubled its net income over the year-ago quarter, but its stock traded down on the distributor’s warning that future earnings could be impacted by customer consolidation in North America.
The Plainfield, Ind.-based, global distributor of mobile phones made sales totaling $851 million in the second quarter and net income totaled $17.7 million, up sharply from $8.2 million in the year-ago quarter. According to the company, it handled a record 19.4 million devices in the second quarter.
Though Brightpoint touted its long-term growth potential, it warned that with AT&T Inc.’s announced purchase of Dobson Communications Corp. (set to close later this year) and Verizon Wireless’ planned acquisition of Rural Cellular Corp. (set to close in early 2008), two key customers in North America would in effect disappear.
The company said it would cut costs in its North American operations to ease the impact of these acquisitions, but said “there can be no assurances that we will be successful in these efforts.”
In after-market trading yesterday, Brightpoint shares fell as much as 7.5%, presumably on the warning about short-term, future earnings.