UTStarcom Looks at Books

The company hires an independent counsel.
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UTStarcom

(UTSI) - Get Report

shares dipped Thursday on word of a bookkeeping review and lower-than-expected guidance for the current quarter.

The Alameda, Calif., wireless tech company posted a preliminary net loss of $20.6 million, or 17 cents a share, on sales of $685.5 million in the fourth quarter ended in December. The sales included a $40 million payment the company had expected in the third quarter.

Looking ahead, the company expects a 24% sequential decline in sales, with revenue in the current quarter projected to drop to about $520 million. Analysts were looking for sales of $631 million in the first quarter, according to Thomson First Call.

On the accounting front, the company says it has initiated an accounting investigation and has hired independent counsel. The inquiry focuses on revenue recognized from an unnamed "customer in India and other related issues," the company says. The revenue being reviewed was booked between 2003 and 2005.

"We are pleased that our initial results for the fourth quarter are in-line with, and in some cases are better than, our guidance for the quarter," CFO Fran Barton said in a press release.

UTStarcom shares fell 9 cents to $6.50 in after-hours trading Thursday.