Despite posting an increase in third quarter sales, telecoms equipment company UTStarcom said that its net losses for the period increased by 29% due to heavy interest expenses.
UTStarcom’s sales jumped 8% to $646.5 million, from $600.9 million, driven by growth in PCD, broadband and wireless business units. The company’s third quarter net loss increased from $43 million in 2006 to $55.3 million.
The operating loss of the company also increased by 17% to $51.5 million in 3Q 2007 compared with 2006. The company attributes the loss to 11% increase in cost of sales. The company’s loss per share in Q3 2007 was $0.46 compared to $0.36 in Q3 2006.
Peter Blackmore, chief operations officer of UTStarcom, said: Our third quarter results do not yet reflect the benefits of changes we are in the process of implementing in UTStarcom. We have strong technology in IP communications and are building momentum in IPTV, NGN and optical infrastructure and access devices.
During the period, UTStarcom’s competitor Nokia reported a 28% increase in the net sales to EUR12.9 billion over 3Q 2006. The operating and net profit of the company increased by 69% and 85%, respectively compared with 3Q 2006. The growth in the company’s net sales was due to a 105% growth in its enterprise solutions division and a 23% growth in the multimedia division.
Source: ComputerWire daily updates