Gross revenue fell 31% y-o-y to $19.8 million, and fell 15% sequentially. Net revenue (total revenues net of third party hardware cost) fell 20% y-o-y to $16.5 million, and fell 18% sequentially. Management's recently guided for $16.0 - $17.0 million. Software products and solutions revenue fell 17% y-o-y to $12.7 million, and fell 15% sequentially. Service revenue fell 24% y-o-y to $3.7 million, and fell 25% sequentially. Gross margin was 24% vs 39% in Q4 2004, and 47% in Q3 2005. Net loss from continuing operations was $28.1 million vs net income of $1.2 million in Q4 2004. Net loss from continuing operations of $0.61 per basic share vs gain of $0.03 per basic share in Q4 2004.
Note: Net revenue shortfall due to lower than expected shipment volume for the Lenovo- AsiaInfo business unit's security products. The company also took a one-time $11.7 million charge in Q4. Q1 2006 Guidance
Net revenue of $16 - $18 million. Security products and services business will post an operating loss of $3 - $4 million. Loss per basic share of $0.04 - $0.05.
Comment: A transcript of tonight's conference call will be posted here after the call.