Airspan Reports Q4

Airspan announced its fourth quarter and full year financial results for the period ending December 31, 2005

March 24, 2006

4 Min Read

BOCA RATON, Fla. -- Airspan Networks Inc. (NasdaqNM:AIRN - News) today announced its fourth quarter and full year financial results for the period ending December 31, 2005. The Company reported record revenues for the fourth quarter of $37.9 million, up 24% versus the third quarter of 2005 and up 1% versus the final quarter of 2004. The net loss attributable to common stockholders for the fourth quarter was $(0.08) per share versus a profit of $0.07 per share in the fourth quarter of 2004. Full year reported revenues for 2005 were also a record at $111.0 million, up 17% versus the $94.6 million reported for 2004. The net loss per share for the full year 2005 was $(0.39), versus $(0.56) for 2004 that included a cost of $(0.29) for the deemed dividend associated with beneficial conversion of preferred stock.Fourth Quarter Business Highlights

  • WiMAX

    • Announcement of general commercial availability of AS.MAX, the world’s first end-to-end fixed and nomadic WiMAX product portfolio

    • Significant progress at CETECOM with WiMAX certification, which was granted in March 2006

    • Continuing inflow of orders from both direct and indirect channels, including Russia’s first WiMAX network in Samara

    • Launch of Yozan’s WiMAX network in Japan

    • Strategic technology relationship with iDirect Technologies to enable the delivery of seamless broadband communications using a combination of AS.MAX and satellite-based technologies

    • Successful Plugfest in November when Airspan base stations and customer premises equipment (CPE) achieved interoperability with the equipment from several other vendors

  • WipLL

    • WipLL enjoyed its sixth consecutive quarter of growth, producing record revenue and margin levels

    • Established and new customers continued to buy this cost-effective and highly reliable product

  • Proximity

    • In November, Airspan delivered more than 16,000 CPE units, the highest-ever monthly number

  • ASX

    • The legacy product produced its highest quarterly revenue in two years as customers, particularly in Europe and Africa, rediscovered the versatility of this DSL-type product for voice and data services



  • ASNET

    • The Radionet acquisition in November gave Airspan access to the growing market for the deployment of 802.11-based Hotzone networks. Airspan’s WiMAX products complement Radionet’s Wi-Fi systems with the most flexible combination of access and backhaul for IP based voice and data services

    • Joined the Wi-Fi Alliance, demonstrating commitment to delivering interoperable Wi-Fi solutions.

Financial Results Fourth quarter revenue of $37.9 million was 24% higher than the $30.5 million in the third quarter of 2005, and 1% higher than the $37.5 million we reported in the fourth quarter of 2004. We also exceeded the guidance of $33 million provided earlier in the year for the fourth quarter of 2005. The Company recorded a gross profit of $10.1 million in the quarter, and gross profit as a percentage of revenue (the "gross profit margin") was 27%. This compared to a gross profit of $9.1 million and a gross profit margin of 30%, for the third quarter of 2005, and a gross profit of $10.5 million, and a gross profit margin of 28% recorded for the fourth quarter of 2004.

The lower gross profit margin in the fourth quarter of 2005 resulted primarily from a negative book to physical inventory adjustment at our Israeli facility, and lower margins on our Proximity product. Gross profit for 2005 of $31.5 million was 15% higher than the $27.4 million recorded in 2004. The gross profit margin for 2005 was 28% versus 29% in 2004. The overall gross profit margin level remained relatively constant during this transition year as higher margins generated by increased WipLL sales and from the introduction of products from acquisitions in 2005 were offset by lower pricing of ASX and Proximity products.

The Company's fourth quarter 2005 operating expenses of $13.8 million were 32% greater than the fourth quarter 2004 operating expenses of $10.4 million and $1.6 million greater than the prior quarter's operating expenses. Full year operating expenses were $48.5 million, an increase of 14% over the total of $42.5 million recorded in 2004. The major factors behind the growth in operating expenses were the additional headcount from our acquisitions, costs for the development of our WiMAX products and increased audit expenses. Net loss for the fourth quarter of 2005 was $(3.3) million, or $(0.08) per common share, compared to a net profit of $3.3 million, or $0.07 per common share, in the fourth quarter of 2004 and a net loss of $(2.1) million or $(0.05) per share in the third quarter of 2005. The net loss for the full year 2005 was $(15.1) million, or $(0.39) per common share compared to a 2004 full year net loss of $(20.4) million or $(0.56) per common share. Results in 2005 included a tax credit of $0.5 million, compared to $2.0 million in 2004.

Airspan Networks Inc. (Nasdaq: AIRN)

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