Investors are dumping shares of Powerwave Technologies Inc. (Nasdaq: PWAV). The stock is down 17.56% to $6.43. Keep in mind that earlier this year, the stock was nearly $16 per share.
Well, the company says that revenues will range from $155 million to $160 million. The prior guidance was for $200 million to $210 million. Yes, that's a big miss.
Apparently, Powerwave has had internal difficulties (such as with its new IT system). Also, the third quarter is traditionally slow for the company.
In fact, the stock plunge could pose issues for Powerwave’s acquisition of the wireless division of Filtronic Plc.
Founded in 1985, Powerwave is a supplier of wireless solutions for wireless communications networks. Products include antennas, boosters, combiners, filters, radio frequency power amplifiers, repeaters, tower-mounted amplifiers, and advanced coverage solutions.
As a result, the company has customer concentration. Cingular accounts for 15% of revenues and Nokia (NYSE: NOK) accounts for 10% of revenues.
True, wireless still continues to grow and it means demand for infrastructure. But big-size contracts are typically volatile – as has been the case yet again for Powerwave.