Novatel Wireless Provides Sales Outlook for Third Quarter 2001
SAN DIEGO, Calif.--(BUSINESS WIRE)--Sept. 28, 2001--Novatel Wireless, Inc. (Nasdaq:NVTL), a provider of wireless data communications access solutions, announced today its sales outlook for the third quarter ending September 30, 2001. The Company anticipates that sales for the third quarter will be in the $4 to $6 million range. These projections are preliminary and subject to change as final orders are processed through the end of the quarter.
"During the quarter, we experienced delays in rolling out volume shipments of GPRS," said John Major, chief executive officer at Novatel Wireless. "When combined with the weak overall telecom market and the tragic events of September 11th, these delays greatly impacted our third quarter results. Despite the decrease in revenues, we made significant progress in lowering our cash burn rate. We have been successful in aggressively reducing costs and as a result have a much lower breakeven point now than we did when the quarter began."
The Company also announced today that it has signed a new contract for GPRS products with one of the world's leading telecommunications carriers. The new contract is valued at over $10 million. Additionally, the Company has also signed a new supply contract for GPRS products with a major PC manufacturer. Novatel Wireless expects to start shipping GPRS products in volume in the fourth quarter.
Mr. Major continued, "GPRS is an exciting technology; while the delays have been frustrating, it's impact and the impact of CDMA 1xRTT will be well worth the wait. With a growing backlog of well over $50 million and the anticipated roll-out of CDMA 1xRTT in the fourth quarter, we believe that we will significantly increase revenues in the fourth and first quarters. While we are disappointed in the delays, we believe that we remain a clear technology leader and a key partner for telecommunications carriers."
The company will issue its third quarter earnings release and hold its regularly scheduled conference call for analysts and investors to discuss this press release on October 25, 2001 at 5:00 p.m. EDT. Open to the public, a live Web cast of the conference call will be accessible from the "Investor Relations" section of Novatel Wireless's Web site (www.novatelwireless.com).
Safe Harbor Statement
This release contains forward-looking statements, which are made pursuant to the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. In particular, this release includes statements about expected future revenue. These forward-looking statements involve risks and uncertainties. A number of important factors could cause actual results to differ materially from those in the forward-looking statements, including risks and uncertainties that may cause Novatel Wireless to have different actual future revenue. These factors include risks and uncertainties relating to the current economic slowdown, fluctuations in demand for existing and new products, the need to successfully introduce and market new products, the roll-out of 2.5G technology like GPRS and CDMA 1xRTT, the effect of competition, technological changes, continued acceptance of Novatel Wireless' products and dependence on intellectual property rights. These statements are also subject to risks and uncertainties, including the ability of Novatel Wireless to identify and eliminate expenses effectively, possible fluctuations in future expenses and significant expenses that may need to be incurred but that are unforeseen at this time. Other factors that could cause actual results to differ materially are discussed in more detail in Novatel Wireless' filings with the United States Securities and Exchange Commission and other regulatory agencies.
About Novatel Wireless
Novatel Wireless, Inc. is a leading provider of wireless data modems and software for use with handheld computing devices and portable personal computers. The company delivers innovative and comprehensive solutions that enable businesses and consumers to access personal, corporate and public information through email, enterprise networks and the Internet. Novatel Wireless also offers wireless data modems and custom engineering services for hardware integration projects in a wide range of vertical applications. The Novatel Wireless product portfolio includes the Minstrel(R) Family of Wireless Handheld Modems, Merlin(TM) Family of Wireless PC Card Modems, Sage(R) Wireless Serial Modems, Lancer 3W(TM) Family of Ruggedized Modems and Expedite(TM) Family of Wireless Embedded Modules. Headquartered in San Diego, California, Novatel Wireless is listed on the Nasdaq Stock Market (Nasdaq:NVTL). For more information, please visit the Novatel Wireless web site: www.novatelwireless.com or call 888/888-9231.
CONTACT:
Novatel Wireless, Inc., San Diego
Melvin Flowers, 858/812-3415
www.novatelwireless.com
or
the blueshirt group
Chris Danne or Lyle Ross, 415/217-7722
chris@blueshirtgroup.com
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