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Novatel Wireless Inc. New Reports Operating Results (10-Q)

August 09, 2012 | About:
10qk

10qk

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Novatel Wireless Inc. New (NVTL) filed Quarterly Report for the period ended 2012-06-30.

Novatel Wireless Inc has a market cap of $76.5 million; its shares were traded at around $2.14 with and P/S ratio of 0.2.

Highlight of Business Operations:

Cost of net revenues. Cost of net revenues for the three months ended June 30, 2012 was $79.2 million, or 77.3% of net revenues, as compared to $91.8 million, or 77.8% of net revenues, for the same period in 2011. During the second quarter of 2012, the cost of net revenues as a percentage of net revenues benefitted from a favorable mix of 4G MiFi products sold, and from lower quarter over quarter purchased intangible amortization expense decreasing to $289,000 during the quarter ended June 30, 2012 as compared to $1.1 million in the comparable quarter of 2011. The cost of net revenues as a percentage of revenues is expected to fluctuate in future quarters depending on revenue levels, the mix of products sold, competitive pricing, new product introduction costs and other factors.

Sales and marketing expenses. Sales and marketing expenses for the three months ended June 30, 2012 were $7.3 million, or 7.1% of net revenues, compared to $8.2 million, or 7.0% of net revenues, for the same period in 2011. The $900,000 decrease for the three months ended June 30, 2012 compared to the same period in 2011 related to lower cooperative advertising and joint marketing expenses in our Mobile Computing Products segment.

General and administrative expenses. General and administrative expenses for the three months ended June 30, 2012 were $5.7 million, or 5.6% of net revenues, compared to $5.7 million, or 4.8% of net revenues, for the same period in 2011. General and administrative expenses for the three months ended June 30, 2012 remained flat as compared to the same period in 2011. While we are closely monitoring and working to control general and administrative costs, we expect these costs to be negatively impacted by legal fees to defend the claims described in Note 9 to our consolidated financial statements included in this report. During the second quarter periods in 2012 and 2011, the Company incurred $1.7 and $1.5 million in legal expenses, respectively.

Sales and marketing expenses. Sales and marketing expenses for the six months ended June 30, 2012 were $15.0 million, or 7.4% of net revenues, compared to $15.6 million, or 8.7% of net revenues, for the same period in 2011. The $606,000 decrease for the six months ended June 30, 2012 compared to the same period in 2011 was due primarily to lower cooperative advertising and joint marketing expenses.

General and administrative expenses. General and administrative expenses for the six months ended June 30, 2012 were $11.2 million, or 5.5% of net revenues, compared to $10.3 million, or 5.7% of net revenues, for the same period in 2011. The lower expense for the 2011 period was due to an $880,000 benefit recorded in 2011 related to the revision of estimated contingent consideration related to the acquisition of Enfora. While we are closely monitoring and working to control general and administrative costs, we expect these costs to be negatively impacted by legal fees to defend the claims described in Note 9 to our condensed consolidated financial statements included in this report. During the six months ended June 30, 2012 and 2011, the Company incurred $2.7 and $2.5 million in legal expenses, respectively.

Read the The complete Report

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