earnings are outhttps://www.sierrawireless.com/news/oct-11-00.html
Vancouver, BC – October 11, 2000 - We have recorded strong growth in revenue and a return to profitability for the third quarter of 2000.
Our revenue for the three months ended September 30, 2000 amounted to a record US$15.2 million compared to $5.8 million in the third quarter of 1999, an increase of 160.2%. These revenues exceeded our expectations and included significant growth in our OEM and AirCard products.
Our gross margins amounted to $7.0 million for the third quarter of 2000 compared to $3.1 million for the same period in 1999. Our gross margin percentage decreased to 46.2% from 53.0% due to a higher mix of OEM product sales. Our gross margin percentage was stable on a sequential basis, 46.2% in the third quarter of 2000 compared to 46.7% in the second quarter of 2000.
Our total operating expenses for the third quarter of 2000 amounted to $8.2 million compared to $2.8 million in 1999. Our expenses reflected increased investment in development and marketing programs associated with emerging wireless technologies.
Our net earnings were $0.1 million for the third quarter of 2000 compared to net earnings of $0.8 million in 1999.
Our basic and diluted earnings per share amounted to $0.00 (nil) for the third quarter of 2000 compared to basic and diluted earnings per share of $0.05 in the third quarter of 1999.
“In the third quarter, we achieved record revenues and growth as a result of strong demand across our major products. OEM modules for AMPS, CDPD and CDMA, as well as AirCards for CDPD, were the largest contributors to this growth. Throughout this year, we have been making and continue to make significant investments in emerging wireless technologies. With strong revenue growth, and after taking into account these investments, we are very pleased to report that we have returned to profitability two quarters earlier than we originally anticipated. In the fourth quarter, we expect AirCards for CDMA networks to become a significant contributor to our revenues,” said David Sutcliffe, President and Chief Executive Officer.
Third Quarter Highlights Included:
We added three new members to the WirelessReady Alliance (WRA), further increasing the association’s breadth of service. Mobilize, Inc., w-Trade Technologies and MacDonald Dettwiler joined the now 33 member WRA, founded in 1998 by us. We held our second annual WRA conference in September.
We announced an agreement with MobileLogic, Inc., a leading mobile solutions provider for the enterprise, to offer its enterprise customers secure wireless connectivity to transaction-based LAN applications. MobileLogic will package and co-brand its Mobile Communications Manager software with our AirCard 300 to provide mobile workers with a fast and convenient wireless connection to the corporate network.
We are participating in a multi-city seminar series this fall with MobileLogic and in association with Microsoft® Corporation titled “BackOffice Unplugged”. This seminar series, to be held at Microsoft sales offices throughout the United States, will give business leaders and IT professionals an opportunity to learn more about the impact of the booming wireless and mobile computing market on business and the value of providing secure mobile access to the Microsoft Exchange and BackOffice environments.
We announced an agreement with HyComm Technology Company Limited, a wireless network provider in China, to deliver wireless data products to the emerging mobile workforce. We will supply a complete range of wireless data products including our AirCard 300. In addition, we will provide extensive training on wireless technologies to HyComm Technology and their value added resellers. We will also work closely with HyComm Technology to deploy wireless data solutions throughout Greater China, including Hong Kong.
We announced, with Sprint PCS, the new Sprint PCS Wireless Web Modem, the world's first true type II Code Division Multiple Access (CDMA) PC Card wireless modem. Sprint PCS has chosen our patented AirCard 510 as a PC Card connection solution option to provide wireless access to the Internet and corporate network applications. The new device is part of the Sprint PCS Wireless Web for Business - a portfolio of products and services aimed at providing solutions that allow enterprise customers to wirelessly extend their corporate applications to the mobile workforce.
We announced an agreement with PrairieComm to use the PrairieComm PCI3800, the wireless industry’s first integrated baseband processor designed to support the emerging TDMA/EDGE standard for third generation cellular telephony. We will deliver the PrairieComm-equipped AirCards to AT&T Wireless Services for deployment under the terms of the existing AT&T/Sierra Wireless supply agreement.
We announced an agreement with GoAmerica Communications Corp. to bundle its industry-leading Go.WebTM wireless Internet technology with our wide-area network solution. The joint marketing and sales initiative will allow GoAmerica to offer its mobile business customers our award-winning AirCard 300 and GoAmerica's Go.WebTM service in one package, providing the growing population of laptop users access to a complete wireless data solution.
We announced a new product direction for Sierra Wireless to provide wireless data and Internet access solutions for Palm OS PDA’s, commencing with the Handspring Visor handheld computer. We are developing a new wireless adaptor that will plug into the Visor’s Springboard slot. The wireless solution will combine this new wireless adapter with GoAmerica’s Go.Web service and the Handspring Visor. GoAmerica has entered into an initial supply agreement for the new Springboard Adapter with commercial shipments expected to commence in the first quarter of 2001.
· In early October, we announced a broad-based alliance with Lucent Technologies to accelerate commercialization of third generation mobile Internet services using Lucent wireless networks and next-generation wireless consumer appliances that incorporate Sierra Wireless products. The Lucent alliance, which includes coordinated development and interoperability testing, will help us develop a better understanding of operator needs and will expand the reach of our products to new wireless carriers and markets in a timely manner.
All amounts are expressed in U.S. dollars and are in accordance with generally accepted accounting principles in the United States.
Forward-Looking Statements
This press release contains forward-looking statements that involve risks and uncertainties. These forward-looking statements relate to, among other things, plans and timing for the introduction or enhancement of our services and products, statements about future market conditions, supply and demand conditions, and other expectations, intentions and plans contained in this press release that are not historical fact. Our expectations regarding future revenues depend upon our ability to manufacture and supply products which we do not produce today and that meet defined specifications. When used in this press release, the words "plan," "expect," "believe," and similar expressions generally identify forward-looking statements. These statements reflect our current expectations. They are subject to a number of risks and uncertainties, including, but not limited to, changes in technology and changes in the wireless data communications market. In light of the many risks and uncertainties surrounding the wireless data communications market, you should understand that we cannot assure you that the forward-looking statements contained in this press release will be realized.
About Sierra Wireless
We are a leading provider of wireless data communications hardware and software products. We deliver wireless PC Cards for portable computers, rugged vehicle-mounted wireless modems and OEM modules for embedded applications. We are a founding member of the WirelessReady Alliance, an alliance of industry-leading hardware, software and service companies committed to the delivery of complete and compelling wireless data solutions.
Click here for detailed financial statements (20k, PDF)
Conference Call and Instant Replay
We will host a conference call to review our results on October 11, 2000 at 2:30 pm PDT, 5:30 pm EDT. To participate in this conference call, please dial the following toll free number approximately five minutes prior to the commencement of the call:
1-800-446-4472
Should you be unable to participate, Instant Replay will be available for 72 hours following the conference call by dialing:
1-888-509-0081
We look forward to having you participate in our call.
FOR FURTHER INFORMATION PLEASE CONTACT:
Sierra Wireless, Inc.
Peter W. Roberts, CA, CPA
Chief Financial Officer
(604) 231-1192
Website: www.sierrawireless.com
Email: roberts@sierrawireless.com