EXHIBIT 99.1
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[NextWave Wireless Logo]
News
FOR IMMEDIATE RELEASE
NEXTWAVE WIRELESS ANNOUNCES THIRD QUARTER 2007 FINANCIAL RESULTS
Company Reports 166 Percent Quarterly Revenue Growth
Compared to Third Quarter 2006
SAN DIEGO, CA, November 14 -- NextWave Wireless Inc. (NASDAQ: WAVE), a global
provider of wireless broadband and mobile multimedia products, filed its
Quarterly Report on Form 10-Q for the third fiscal quarter which ended September
29, 2007. Financial schedules are included with this release.
NextWave reported that its third quarter revenues increased 166 percent compared
to third quarter 2006. Revenues were $17.8 million for the third quarter of
2007, an $11.1 million increase over the third quarter in 2006 and a $4.9
million increase over the second quarter in 2007. The robust increase in
quarterly revenue was driven by the continued growth in mobile device software
royalties generated by the company's PacketVideo subsidiary and by increased
sales of wireless broadband network equipment and subscriber devices by the
company's IPWireless, Inc. subsidiary which was acquired in the second quarter
of 2007.
"We are very pleased with the rapid revenue growth achieved by our PacketVideo
and IPWireless subsidiaries this quarter and the transition from early-stage
development to pre-commercialization status of our WiMAX chipset business," said
Allen Salmasi, chairman and chief executive officer of NextWave Wireless Inc.
"These achievements are the direct result of the investments we have made in our
people, our business, and our technologies."
NextWave reported that its loss from operations was $91.7 million for the third
quarter of 2007, representing an increase of $65.3 million, when compared to the
loss from operations for the third quarter of 2006 and an increase of $32.2
million over the second quarter of 2007. Approximately forty percent, or $36.9
million, of the loss was attributable to the accounting for the acquisition of
the GO Networks and IPWireless businesses during the first half of the year, and
from the integration of the operations of those businesses. NextWave expects to
realize improved contributions from these businesses in the future resulting
from the achievement of operating efficiencies, improved margin contributions
and the one-time nature of approximately $11.2 million of these charges.
Loss from operations during the third quarter of 2007, as compared to the third
quarter of 2006, increased primarily due to increased operating expenses of
$76.4 million, of which $18.3 million were non-cash expenses arising from the
accounting for purchased in-process R&D and the amortization of intangible
assets as a result of the acquisition of GO Networks and IPWireless and new
spectrum properties. Approximately $31 million of the increase in operating loss
was attributable to increases in R&D, of which $17.5 million was due to the
growth of the semiconductor engineering team at NextWave Broadband and
activities related to the commercialization of the company's family of WiMAX
chipsets and $10.9 million was attributable to the addition of the IPWireless
and GO Networks operations earlier in the year. The addition of the IPWireless
and GO Networks operations in the first half of 2007 also accounted for
additional increases in operating expenses of $16.2 million attributable to
increases of $11.1 million in cost of revenues and $5.1 million in sales,
marketing, and G&A expenses.
Excluding cost of revenues for the quarter of $17.3 million, total operating
expenses for the third quarter were $92.2 million, of which thirty-three
percent, or $30.3 million, were attributable to non-cash expenses, including
$8.7million for the amortization of intangible assets related to acquisitions,
$6.9 million for non-cash share based and other compensation expense, $3.5
million for depreciation and $11.2 million for In-Process Research and
Development (IPR&D) expense related to the acquisition of IPWireless, Inc.
Net interest expense for the third quarter of 2007 was $7.2 million, a $1.6
million increase over the third quarter of 2006 and a $1.2 million increase from
the second quarter of 2007. The increase in interest expense over the second
quarter and compared to the third quarter of 2006 was driven primarily by
interest expense related to the issuance of $350 million of 7% Senior Secured
Notes in July 2006, and available cash balance during the third quarter.
Net loss available to common shares for the third quarter of 2007 was $(107.8)
million, or $(1.17) per share, compared to a net loss available to common shares
of $(31.8) million, or $(0.39) per share for the third quarter of 2006 and a net
loss available to common shares of $(72.1) million, or $(0.81) per share, for
the second quarter of 2007.
During the third quarter of 2007, NextWave Broadband announced the release of
its NW1000 Series WiMAX chipset; the first generation in a family of WiMAX
baseband and multi-band RFIC chipsets designed to provide wireless device and
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network equipment manufacturers with an advanced platform to develop
next-generation WiMAX mobile terminal and infrastructure products. The company's
second-generation chips, designed for high-volume, full-commercial production is
planned for the first half of 2008.
Consistent with its strategy to acquire and make available licensed spectrum to
network operators who deploy the company's wireless broadband products and
technologies, NextWave, through its Inquam Broadband GmbH subsidiary, completed
its acquisition of a 65% controlling interest in Zurich-based WiMAX Telecom AG
which has wireless broadband spectrum concessions in Austria, Slovakia, and
Croatia.
In July 2007, NextWave announced the launch of its Latin American business
operation, NextWave Wireless - Latin America. The new business unit was
established to deliver NextWave's broad array of industry-leading mobile
broadband and wireless technology solutions to customers throughout the Latin
American region.
Recently, on November 5, 2007, PacketVideo announced that it has joined the Open
Handset Alliance as a founding member, along with more than 30 other industry
leaders including Google. PacketVideo is responsible for supplying the
multimedia sub-system, providing for essential media features for media device
development, of the OpenCORE(TM) software for the Alliance's Android platform.
PacketVideo expects to market a broad suite of innovative applications,
features, and services designed to enhance its contributed OpenCORE(TM)
software.
"Our third quarter results are consistent with our expectations and will further
strengthen our position for future growth. We're looking forward to a successful
commercial launch of our low- power, 65 nanometer, WiMAX baseband and RFIC
products in 2008 including a fully-integrated Wi-Fi and WiMAX chipset with
matched multi-band RFIC that supports global roaming and unique broadcast
capabilities. To accelerate the commercial introduction of our WiMAX chipsets
and technologies, we have also undertaken joint development activities with
world-class device vendors," Salmasi added. "We also remain very excited about
the prospects of our TDtv(TM) mobile broadcast technology which has already been
successfully tested by some of the largest carriers in Europe. IPWireless and
PacketVideo are currently working with major device manufacturers to incorporate
our TDtv chipsets, embedded multimedia software and other technologies into a
wide range of exciting 3G devices."
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NextWave Wireless Announces Third Quarter and Fiscal 2007 Results
NEXTWAVE WIRELESS INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT PAR VALUE DATA)
SEPTEMBER DECEMBER
29, 30,
2007 2006
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ASSETS (UNAUDITED)
Current assets:
Cash and cash equivalents $ 72,871 $ 32,980
Short-term investments 188,854 167,705
Accounts receivable, net of allowance for doubtful
accounts of $375 and $321, respectively 22,722 5,056
Inventory 4,638 266
Deferred contract costs 20,821 2,397
Prepaid expenses and other current assets 12,145 7,571
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Total current assets 322,051 215,975
Restricted cash
75,000 75,000
Wireless spectrum licenses, net
574,931 527,998
Goodwill
140,262 32,184
Other intangible assets, net
80,813 18,570
Property and equipment, net
43,547 17,529
Other noncurrent assets
6,782 9,823
Total assets $ 1,243,386 $ 897,079
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 28,785 $ 1,630
Accrued expenses 57,829 33,537
Current portion of long-term obligations 6,223 3,065
Deferred revenue 49,592 10,253
Other current liabilities and deferred credits 3,034 1,240
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Total current liabilities 145,463 49,725
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Deferred income tax liabilities 85,556 75,774
Long-term obligations, net of current portion 316,552 298,030
Other long-term obligations, deferred credits and
reserves 5,924 3,324
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Total liabilities 553,495 426,853
Minority interest in subsidiary -- 1,048
Commitments and contingencies
Redeemable Series A Senior Convertible
Preferred Stock, $0.001 par value; 355
shares authorized; 355 shares issued and
outstanding, liquidation preference of
$368,814 at September 29, 2007 364,919 --
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Stockholders' equity:
Preferred stock, $0.001 par value; 25,000
shares authorized; 355 shares designated
as Series A Senior Convertible Preferred
Stock; no other shares issued or outstanding -- --
Common stock, $0.001 par value; 400,000 shares
authorized; 92,666 and 83,716 issued and
outstanding at September 29, 2007, and
December 30, 2006, respectively 93 84
Additional paid-in-capital 691,315 620,423
Accumulated other comprehensive loss 48 (357)
Accumulated deficit (366,484) (150,972)
Total stockholders' equity
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Total liabilities and stockholders' equity $ 1,243,386 $ 897,079
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NextWave Wireless Announces Third Quarter and Fiscal 2007 Results
NEXTWAVE WIRELESS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED)
THREE MONTHS ENDED NINE MONTHS ENDED
------------------ -----------------
SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER
29, 30, 29, 30,
2007 2006 2007 2006
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Revenues $ 17,752 $ 6,670 $ 38,330 $ 16,868
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Operating expenses:
Cost of revenues 17,324 3,506 31,538 7,951
Engineering, research and development 42,556 11,634 99,953 36,017
General and administrative 30,939 14,896 70,351 35,528
Sales and marketing 7,449 2,992 16,684 7,144
Purchased in-process research and
development costs 11,200 -- 12,060 1,648
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Total operating expenses 109,468 33,028 230,586 88,288
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Loss from operations (91,716) (26,358) (192,256) (71,420)
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Other income (expense)
Interest income 4,870 3,419 12,387 9,803
Interest expense (12,033) (9,010) (34,619) (9,684)
Other income and expense, net (1,622) (26) (1,320) 98
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Total other income (expense), net (8,785) (5,617) (23,552) 217
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Loss before provision for income
taxes and minority interest (100,501) (31,975) (215,808) (71,203)
Income tax benefit (provision) (351) (93) (752) 116
Minority interest -- 265 1,048 1,136
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Net loss (100,852) (31,803) (215,512) (69,951)
Less: Preferred stock dividends (6,862) -- (13,814) --
Accretion of issuance costs on
preferred stock (69) -- (139) --
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Net loss applicable to common
shares $(107,783) $ (31,803) $(229,465) $ (69,951)
========= ========= ========= =========
Net loss per common share - basic and
diluted $ (1.17) $ (0.39) $ (2.60) $ (0.86)
Weighted average shares used in per
share calculation 92,468 81,833 88,413 81,722
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NextWave Wireless Announces Third Quarter and Fiscal 2007 Results
NEXTWAVE WIRELESS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS) (UNAUDITED)
NINE MONTHS ENDED
----------------------
SEPTEMBER SEPTEMBER
29, 30,
2007 2006
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OPERATING ACTIVITIES
Net loss $(215,512) $ (69,951)
Adjustments to reconcile net loss to net cash used
in operating activities:
Depreciation 8,023 4,235
Amortization of intangible assets 15,418 3,752
Non-cash share-based compensation 8,157 3,548
In-process research and development 12,060 1,648
Accretion of interest expense 15,647 4,643
Minority interest (1,048) (1,136)
Other non-cash adjustments 2,626 2,387
Changes in operating assets and liabilities:
Accounts receivable (2,631) (2,221)
Inventory 1,143 (59)
Deferred contract costs (16,546) (2,116)
Prepaid expenses and other current assets (813) (1,938)
Other assets 2,123 1,336
Accounts payable and accrued liabilities (3,584) 11,604
Deferred revenue 25,979 3,950
Other current liabilities and deferred credits 219 (238)
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Net cash used in operating activities (148,739) (40,556)
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INVESTING ACTIVITIES
Proceeds from maturities of available-for-sale
securities 19,273 192,226
Proceeds from the sale of available-for-sale
securities 865,234 452,951
Purchases of available-for-sale securities (905,251) (477,927)
Payments for wireless spectrum licenses (34,607) (397,817)
Cash paid for business combinations, net of cash
acquired (80,332) (4,950)
Purchase of property and equipment (22,422) (10,990)
Other, net (500) (1,866)
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Net cash used in investing activities (158,605) (248,373)
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FINANCING ACTIVITIES
Proceeds from the sale of Series A Senior
Convertible Preferred Stock, net of costs to issue 351,146 --
Proceeds from long-term obligations, net of costs to
issue -- 295,098
Payment to restricted cash account securing
long-term obligations -- (75,000)
Payments on long-term obligations (4,052) (2,374)
Proceeds from the sale of common equity interests 2,175 2,379
Proceeds from investment by joint venture partner -- 1,995
Cash distributions paid to members (2,034) (1,447)
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Net cash provided by financing activities 347,235 220,651
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Net increase (decrease) in cash and cash
equivalents 39,891 (68,278)
Cash and cash equivalents, beginning of period 32,980 93,649
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Cash and cash equivalents, end of period $ 72,871 $ 25,371
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ABOUT NEXTWAVE WIRELESS INC.
NextWave Wireless Inc. supplies a broad range of advanced mobile broadband and
wireless multimedia products and technologies to many of the largest mobile
device manufacturers, network equipment suppliers, and wireless service
providers in the world. NextWave's products include WiMAX/Wi-Fi semiconductors,
TD-CDMA mobile broadband systems, wide-area Wi-Fi networks, and device-embedded
multimedia software solutions. The company develops and markets its products
through its family of world-class operating companies which include NextWave
Broadband Inc., PacketVideo Corporation, IPWireless, and GO Networks, Inc.
NextWave's extensive portfolio of licensed spectrum holdings include nationwide
spectrum in the U.S., Canada, Germany, Switzerland, Austria, Croatia, Czech
Republic and Slovakia. The company intends to make its spectrum available to
customers of its advanced mobile broadband products and solutions. NextWave
Wireless is headquartered in San Diego, California, U.S.A., and has offices in
over a dozen countries. Visit NextWave Wireless at www.NextWave.com.
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This press release contains "forward-looking statements" for purposes of the
Private Securities Litigation Reform Act of 1995 that involve risks and
uncertainties. There can be no assurances that forward-looking statements will
be achieved, and actual events or results could differ materially from the
events or results predicted by such statements. Important factors that could
cause actual events or results to differ materially are discussed in greater
detail in the filings of NextWave with the Securities and Exchange Commission.
All such documents are available through the SEC's website at www.sec.gov.
NextWave makes no commitment to update any forward-looking statements in order
to reflect subsequent changes in events or circumstances except as may be
required pursuant to applicable law.
# # #
CONTACTS
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MEDIA
Michael Gury
NextWave Wireless Inc.
(203) 742-2535
mgury@nextwave.com
INVESTOR RELATIONS
Roseann Rustici
NextWave Wireless Inc.
(203) 742-2539
rrustici@nextwave.com
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