Guidance not goodThe following guidance for the first quarter of 2005 reflects our
current business indicators and expectations. Inherent in this
guidance are risk factors that are described in detail in our
regulatory filings. Our actual results could differ materially from
those presented below. All figures are approximations based on
management's current beliefs and assumptions and are subject to
change.
Following our considerable revenue and earnings growth in 2004,
we expect a significant reduction in our business in early 2005. We
expect revenue in the first quarter of 2005 to be approximately $40
million less than in Q4 2004. This is partially a result of lower
sales from embedded modules that will not include further shipments
to palmOne for the Treo600. We also expect that Q1 demand for PC
cards will be lower as a result of channel inventory levels at some
of our channel partners that is already sufficient to meet their
short term customer demand and the near term impact of increased
competition, and resulting loss of market share, in the EVDO PC card
market.
During 2005, we expect to increase our research and development
efforts to ensure we are well positioned with new products that will
take advantage of market opportunities associated with the deployment
of 3G networks.
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*T
Q1 2005 Guidance
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Revenue $18 - $20 million
Gross margin 34% - 35%
Operating expenses $16.5 - $17.0 million
Net loss $(9.2) - (9.9) million
Loss per share $(0.35) - $(0.38)
Cash flow from operations Negative