Telcos are not buying
Network equipment maker Netgear has surprised analysts by predicting that its current-quarter revenue was below their expectations.
The company said that telecom service providers had cut spending and it forecast revenue of $290 million to $305 million for the first quarter. Analysts on average were looking for $317.6 million. Netgear bought a part of Canadian wireless communication equipment maker Sierra Wireless’s mobile broadband business for $100 million last month and it said it expected the first half of 2013 to be tempered by reduced spending from service providers.
The company's net income fell to $16.1 million in the fourth quarter in comparison with $22.8 million a year earlier. On the plus side, revenue rose marginally to $310.4 million. Shares of Netgear fell seven per cent after the announcement.