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UTStarcom (UTSI) Posts Q3 Improvements, Reiterates Full-year 2011 Guidance

UTStarcom Holdings Corp., a leading provider of interactive, IP-based network solutions and broadband for cable and telecom operators, today reported financial results for the third quarter ended Sept. 30, 2011.

The company posted third-quarter 2011 revenues at $83.3 million, up 36 percent over the $61.4 million reported for the third quarter of 2010.

Gross profit increased 164 percent year-over-year to $31.9 million in the third quarter of 2011 compared to $12.1 million reported for the comparable quarter of 2010.

Gross margin was 38 percent in the third quarter of 2011 compared to gross profit of 19.7 percent reported in the third quarter of last year.

Operating income for the third quarter of 2011 was $14.2 million compared to an operating loss of $23.3 million for the corresponding period of 2010.

UTStarcom reported third quarter 2011 net income of $8.0 million, or basic earnings per share of $0.05, compared to a net loss of $17.2 million, or basic loss per share of $(0.13), for the third quarter of the year prior.

As of Sept. 30, 2011, the company reported cash, cash equivalents and short-term investments of $305.9 million.

UTStarcom president and CEO Jack Lu said sustaining profitability is one of the main goals for the company, which it achieved this quarter. He also noted the company’s achievements in the third quarter, which contributed to its year-over-year performance.

“Our cost restructuring efforts continue to show encouraging results as we recorded our second consecutive profitable quarter. In the third quarter of 2011, we announced the completion of our first end-to-end Internet TV solution for a cable TV network customer and launched five new products at the Beijing Telecommunications EXPO,” Lu stated in the press release. “ … As we look to the quarters ahead, demand for our solutions and services is healthy and our focus will be on execution and expanding our revenue contribution from higher value-added solutions.”

Company CFO Jin Jiang reiterated UTStarcom’s guidance for revenue, expense control and profitability for 2011. Total revenues are estimated in the range of $300.0 million to $320.0 million; annualized operating expenses are expected to be less than $100.0 million; and the company anticipates break even for full-year 2011.

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