Tuesday, October 7, 2008

NETGEAR Warns on Q3 Revenues

NETGEAR warned that its net revenue for the third quarter ended September 28, 2008 is expected to be in the range of $173 million to $183 million, or below the range of $208 million to $212 million provided on July 23, 2008.

"We experienced weakness in September demand on our consumer products across all channels and in all geographies, particularly in the service provider channel, where our carrier customers worldwide requested shipment delays on previously placed orders, thereby preventing us from recognizing revenue on those orders," commented Patrick Lo, Chairman and CEO of NETGEAR. "We believe the uncertainty in the economies and financial markets worldwide, especially in light of recent events, is causing the weakening of demand and we expect these conditions to persist until financial confidence returns to the market."

The company expects non-GAAP operating margin to be in the range of 10.3% to 11.3% versus the company's previous expectation of approximately 9.5% to 10.5%. Additionally the company expects to report other expense in the range of $4.5 million to $5.5 million in relation to losses on transactions denominated in foreign currencies. This is primarily a result of the strengthening of the U.S. dollar as compared to the Australian dollar, the British pound and the Euro.http://www.netgear.com