WiMax firm Alvarion swings to Q4 loss

TEL AVIV, ISRAEL: Israel-based Alvarion, a maker of WiMax and wireless broadband equipment, expects to return to profitability by mid-2011 after the maker of WiMax and wireless broadband equipment reported a loss for the fourth quarter of 2010, hit by lower sales.

It posted a quarterly net loss per share excluding one-time items of 18 cents, compared with a profit of 1 cent a year earlier. Revenue fell 16.6 percent from a year ago to $50.3 million.

“Q1 will be a period of transition, during which we will right-size the organisation to a level appropriate to the carrier opportunity, and make modest strategic investments in the enterprise market to improve our position and accelerate growth,” Eran Gorev, president and CEO of the Israel-based company, said in a statement on Wednesday.

“We will begin with an immediate headcount reduction as well as other related expense reductions. Our goal for 2011 is to bring blended gross margin to the high 30's with operating expenses below 35 per cent of revenues on a quarterly basis, and to lay the foundation for sustainable growth from a lower, but profitable, revenue base beginning in Q2.”

Earlier this week a market source told Reuters that Alvarion, which employs about 800 workers, plans to lay off up to 150.

Alvarion said it is not giving a forecast for the first quarter because the timing of revenue from various projects and the magnitude of the restructuring charges cannot be predicted with accuracy.

“We believe the position and reputation we attained provides the basis for further actions that will lead to quarterly profitability by mid-2011,” Gorev said.

Analysts have said that while deployments for WiMax -- a long-range wireless technology -- were continuing, spending has been slower than expected as many mobile carriers have been choosing a rival fourth-generation (4G) technology called LTE.