Netro issues warning, cuts staff by 25%

Point-to-multipoint equipment manufacturer Netro today slashed its sales projections and announced it will lay off a quarter of its workforce to help curb its expenses as it copes with the downturn in the fixed wireless market. The company is firing 73 employees, bringing its workforce to 220 worldwide.

Netro said revenues for second quarter 2001 are expected to be $2 million, down 87 percent from last year’s second quarter equipment sales of $15.5 million. Moreover, the company added that OEM sales will be less than $1 million this year as Lucent and other major vendors have cut orders or abandoned the broadband wireless space. Last year, OEM equipment sales peaked at $19.5 million, representing the bulk of Netro’s revenue.

“Our second quarter revenues reflect the continuing, worldwide pressure on the broadband wireless industry as a result of slower telecommunications equipment spending and reduced capital availability,” said chief financial officer Sanjay Khare in a statement.

First Call/Thomson consensus estimates have Netro reporting a loss of 15 cents per share for the second quarter. In trading today, Netro’s stock fell to $3.71 a share, just shy of its 52-week low of $3.31 in April.