Wednesday, July 19, 2006

Zhone Posts Q2 Revenue of $54.2 Million

Zhone Technologies posted Q2 revenue of $54.2 million compared with $52.7 million for the first quarter of 2006 and $30.4 million for the second quarter of 2005. Net loss for the second quarter of 2006 (GAAP) was $13.1 million or $0.09 per share compared with a net loss of $3.9 million or $0.03 per share for the first quarter of 2006, and a net loss of $3.4 million or $0.04 per share for the second quarter of 2005.



"Despite the sequential quarterly growth of our SLMS and optical businesses and increase in our cash balances, the second quarter was hampered by a greater than expected decline in legacy revenues as well as the significant drop in gross margins caused largely by the write-off of inventory in some of our legacy products," said Mory Ejabat, Chairman and Chief Executive Officer of Zhone. "We hope to improve our gross margins in the future through cost reductions driven by outsourced manufacturing of certain products."http://www.zhone.com

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