Celeritek loses business from Motorola
Motorola is in the process of transitioning from the 120v handset platform, for which Celeritek is the sole source for PA modules, to new handset platforms. Motorola had previously intended to have dual sources of supply for the new platforms, but has now discontinued this strategy and has already selected a sole source supplier other than Celeritek for one of its new platforms.
Although Celeritek will continue to be the sole PA module supplier for the 120v platform, the company expects such sales to decline later this calendar year. Celeritek considers Motorola a valued customer, and fully intends to compete for its business with respect to future platforms.
Celeritek expects that it will begin to feel the effects of Motorola s decision during the current quarter, and that these effects will become more significant starting in the next quarter.
The company now expects that its revenue for the December 2002 quarter will be in the range of $10 million to $11 million, with Motorola accounting for approximately 25-30% of the total figure. Back in October, Celeritek predicted that its revenue for the December quarter would be in the $13 million to $14 million range. Motorola accounted for 56% of Celeritek s net revenue in the April-September 2002 period.
To partially offset the effects of Motorola s recent decision, Celeritek is currently evaluating various cost-saving measures as well as developing additional products that it believes will be attractive to Motorola and other leading phone manufacturers. It expects that its recent purchase of Tavanza, and a recently opened sales and technical support office in Seoul, Korea, will also increase its revenue.
