UPDATE 1-Proxim says expects weaker results, to take charge
THURSDAY, JUNE 28, 2001 11:13 AM
- Reuters
(recasts first paragraph, adds stock movement)
NEW YORK, June 28 (Reuters) - Proxim Inc. (NASDAQ NM:PROX), a chief backer of wireless data networking system HomeRF, on Thursday said its second-quarter results would miss Wall Street estimates, saying its business has lost momentum despite a boom in interest in wireless networks.
Despite a strong day for technology issues, the news pummeled Proxim stock, which was off $3.20, or 22.9 percent, to $10.80 in morning trade on Nasdaq. In contrast, the tech-laden Nasdaq Composite Index (:) was up 2.4 percent.
The company said it now expects pro forma income of between 3 and 7 cents per share in the second quarter on revenues of $23 million to $26 million. It will also take an unspecified charge for excess inventory, purchase commitments for the second quarter and restructuring.
Analysts had, on average, expected a profit of 16 cents per share in the second quarter, according to research firm Thomson Financial/First Call.
Wireless networks have been installed in homes, offices, airports and other public places to allow untethered, high-speed Internet access. HomeRF, one standard for this type of networking, has been beaten back by a competing wireless system called Wi-Fi, backed by networking giant Cisco Systems Inc. (NASDAQ NM:CSCO), 3Com Corp. (NASDAQ NM:COMS) and others.
Proxim stock sank in March after top chip maker Intel Corp. (NASDAQ NM:INTC) switched its allegiance to Wi-Fi from HomeRF.
REUTERS
Rtr 11:13 06-28-01 Copyright 2001, Reuters News Service