UTStarcom reported Q2 revenue of $689.6 million, an increase of 70% over net sales of $405.8 million reported in the second quarter of 2003. GAAP net income for Q2 was $43.2 million, or $0.32 per share. This compares to net income of $39.4 million, or $0.33 per share, for Q2 2003. Q2 gross margins came in at 25.4%, as compared to projected gross margins of 27-28%.
UTStarcom blamed competitive pricing pressure in China as well as supply-chain constraints that delayed recognition of some higher-margin international revenues for margins that were below expectations. In order to better accommodate growing international demand and increased product portfolio diversification, UTStarcom has engaged a leading global supply chain-consulting firm to assist in transforming the company’s supply chain management. http://www.utstar.com
