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BEIJING, May 6, 2011 /PRNewswire-Asia-FirstCall/ -- UTStarcom, Inc. ("UTStarcom" or "the Company") (NASDAQ: UTSI), a leading provider of interactive, IP-based network solutions in iDTV, IPTV, Internet TV and Broadband for cable and telecom operators, today reported financial results for the first quarter of 2011.

"We continued to make progress in improving our cost structure during the first quarter," said Jack Lu, President and CEO of UTStarcom, "and our gross profit margin increased from the previous quarter, in part due to significant sales for our market-leading PTN product. We remain confident that we will achieve our full year financial targets."

First Quarter 2011 Results

Net sales for the first quarter of 2011 were $61.3 million as compared to $80.8 million in the first quarter of 2010.

Gross margin for the first quarter of 2011 was 31% as compared to 34% in the first quarter of 2010 and 11% in the fourth quarter of 2010. Gross profit was $19.1 million in the first quarter of 2011 compared to $27.2 million in the corresponding period of 2010.

First quarter 2011 operating expenses were $30.2 million compared to $46.0 million in the same period of 2010.

The net loss attributable to UTStarcom for the first quarter of 2011 was $10.3 million or a loss of $0.07 per share, as compared to a loss of $16.0 million, or a loss of $0.12 per share in the first quarter of 2010.

Net cash, cash equivalents and short-term investments as of March 31, 2011 was $310.4 million compared to $352.1 million on December 31, 2010.

First Quarter 2011 Operational Highlights

• Won EPON/EOC contracts from cable operators in Hunan, Zhejiang and Jiangsu provinces.
• Received sizable orders of PTN product from Japan following the successful completion of a previously disclosed field trial in 2010.
• Received an award from China's Ministry of Science and Technology for innovative Three Network Convergence solutions at a major China cable industry trade show.
• Moved the Beijing headquarters into a new facility in the first quarter, and entered into a new Lease Agreement for office in Hangzhou. As a result, the Company will save dramatically on rental costs in both locations.  

2011 Outlook

The Company reiterates the following outlook for fiscal year 2011:

• Aiming to achieve total revenue for the year in the range of $300-$320 million, which includes PAS deferred revenue through the end of 2011 at the rate of $23 million per quarter.
• Targeting to generate 10% of total sales in 2011 from its new Operational Support Service business.
• Targeting annualized operating expenses of less than $100 million.
• Committed to breaking even in 2011 on a full year basis.

Conference Call

The Company will host a conference call to discuss the Company's financial results for this period before market open on Friday May 6, 2011.

The call will take place at 5:00 a.m. (PT) / 8:00 a.m. (ET) / 8:00 p.m. China time on Friday, May 6, 2011.

The conference call dial-in numbers are as follows: United States -- 1-800-860-2442; International - 1-412-858-4600. The conference ID number is 450638.

A replay of the call will be available for 7 days. The conference call replay numbers are as follows: United States -- 1-877-344-7529; International -- 1-412-317-0088.

The Conference ID for accessing the recording is 450638.

Investors will also have the opportunity to listen to the conference call and the replay over the Internet through the investor relations section of UTStarcom's website at: http://www.utstar.com.

To listen to the live call, please go to the website at least 15 minutes early to register, and to download and install any necessary audio software. For those who cannot listen to the live broadcast, a replay will also be available on this site.

About UTStarcom, Inc.

UTStarcom is a leading provider of interactive, IP-based network solutions in iDTV, IPTV, Internet TV and Broadband for cable and telecom operators. The Company sells its solutions to operators in both emerging and established telecommunications and cable markets around the world. UTStarcom enables its customers to rapidly deploy revenue-generating access services using their existing infrastructure, while providing a migration path to cost-efficient, end-to-end IP networks.

Founded in 1991, listed on the NASDAQ in 2000, the Company has its operational headquarters in Beijing, China and research and development operations and manufacturing facility in China and India. For more information about UTStarcom, visit the Company's website at http://www.utstar.com.

Forward-Looking Statements

This release includes forward-looking statements, including statements regarding the effects of the Company's corporate structure, the move to new facilities in Beijing and Hangzhou, expectations from the new Operational Support Service Business and expectations regarding the Company's performance in 2011. These statements are forward-looking in nature and subject to risks and uncertainties that may cause actual results to differ materially. These include risks and uncertainties regard the ability of the Company to realize anticipated results of operational improvements, the Company's ability to deliver and capitalize on the opportunities of the new Operational Support Service Business, revenues and expenses under its business model, and executing on its business plan and managing regulatory matters as well as risk factors identified in its latest Annual Report on Form 10-K, Form 10-K/A, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K as filed with the Securities and Exchange Commission. The Company is in a period of transition and the conduct of its business is exposed to additional risks as a result. All forward-looking statements included in this release are based upon information available to the Company as of the date of this release, which may change, and we assume no obligation to update any such forward-looking statement.

SOURCE UTStarcom, Inc.