EXHIBIT 99.1 FOR IMMEDIATE RELEASE For further information contact: John Schoen Jack Seller COO/CFO Director, Marketing & PR PCTEL, Inc. PCTEL, Inc. (773) 243-3000 (773) 243-3016 jack_seller@pctel.com PCTEL POSTS $11.5 MILLION IN SECOND QUARTER REVENUE WIRELESS REVENUE UP 349% OVER SECOND QUARTER LAST YEAR CHICAGO, IL - AUGUST 3, 2004 - PCTEL, Inc. (NASDAQ: PCTI), a global leader in simplifying mobility, today announced financial results for the second quarter ended June 30, 2004. This was the fourth full quarter of operating results following the company's sale of its legacy HSP modem product line to Conexant (NASDAQ: CNXT) in May 2003 as part of PCTEL's well-established wireless transition plan. Total revenue was $11.5 million for the second quarter of 2004, including $10.1 million of wireless product revenue and $1.4 million of licensing revenue. This compares to $10.2 million of revenue in the second quarter 2003, which included $2.3 million of wireless revenue, $0.9 million of licensing revenue, and $7.0 million of HSP modem revenue. The increase in wireless revenue was primarily due to the acquisition of MAXRAD in the first quarter 2004, wireless carrier contract wins to date for the Company's Mobility Solutions software products, and increased demand for its wireless test products through the RF Solutions Group. Net loss for the second quarter of 2004 was $(0.7) million, or $(0.03) per diluted share, compared to net income of $1.1 million, or $0.05 per diluted share reported in the second quarter of 2003. The second quarter last year included a net gain on the HSP modem sale of $1.8 million, which was comprised of a $4.3 million gain offset by $2.5 million of related restructuring cost. "We continue to deliver what we promised to the industry and our stockholders: products that simplify mobility and predictable financial performance," said Marty Singer, PCTEL's Chairman and CEO. "In the second quarter, we launched new connectivity tools with T-Mobile and GoRemote; penetrated new markets with our CLARIFY(TM) Interference Management System and our UMTS scanners; and expanded our portfolio of WiFi and broadband antennas. PCTEL continues to build upon the three new business platforms that we acquired over the past two years. Going forward, we expect to begin to realize the benefits from our efforts in integrating our sales and marketing across our three product groups," added Singer. Cash and short-term investments on June 30, 2004 were $103.6 million, a decrease of $3.8 million from the first quarter of 2004. The decrease is primarily attributed to increases in working capital and the stock buyback program. As of June 30, 2004, the company has repurchased 1.71 million out of the 2.5 million shares authorized by the Board of Directors under its share buyback program. The company repurchased 170,300 of its shares during the quarter just ended. CONFERENCE CALL / WEBCAST The company will hold a conference call at 4:00 PM CDT (5:00 PM EDT) today with Marty Singer, chairman and chief executive officer, and John Schoen, chief operating officer and chief financial officer. The session will include brief remarks, and can be accessed by calling (800) 545-9583 (U.S. / Canada) or (973) 317-5317 (international). To listen via the Internet, please visit, www.pctel.com, or http://www.shareholder.com/pctel/MediaList.cfm REPLAY: A replay will be available for two weeks after the call on PCTEL's web site at www.pctel.com or by calling (800) 428-6051 (U.S. / Canada) or (973) 709-2089 (international) access code: 361989. ABOUT PCTEL PCTEL (NASDAQ: PCTI), founded in March 1994, is a global leader in simplifying mobility. PCTEL's Mobility Solutions' software tools simplify installation, roaming, Internet access and billing. PCTEL's RF Solutions' portfolio of OEM receivers and receiver-based products, measure and monitor cellular networks. PCTEL's MAXRAD Product Group designs, distributes, and supports innovative antenna solutions that facilitate and simplify wireless communications. PCTEL protects its leadership position with a portfolio of more than 130 analog and broadband communications and wireless patents, issued or pending, including key and essential patents for modem technology. The company's products are sold or licensed to PC manufacturers, PC card and board manufacturers, wireless carriers, wireless ISPs, distributors, wireless test and measurement companies, and system integrators. PCTEL headquarters are located at 8725 West Higgins Road, Suite 400, Chicago, IL 60631. Telephone: 773-243-3000. For more information, please visit our web site at: http://www.pctel.com. PCTEL SAFE HARBOR STATEMENT This press release contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Specifically, the statements regarding PCTEL's expectations regarding its future business prospects and the future growth of its wireless and licensing businesses are forward looking statements within the meaning of the safe harbor. These statements are based on management's current expectations and actual results may differ materially from those projected as a result of certain risks and uncertainties, including the ability to successfully grow the wireless products business, the ability to implement new technologies and obtain protection for the related intellectual property, and the risks inherent in potential acquisitions. These and other risks and uncertainties are detailed in PCTEL's Securities and Exchange Commission filings. These forward-looking statements are made only as of the date hereof, and PCTEL disclaims any obligation to update or revise the information contained in any forward-looking statement, whether as a result of new information, future events or otherwise. # # # PCTEL, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED, IN THOUSANDS, EXCEPT PER SHARE INFORMATION) Three Months Ended Six Months Ended June 30, June 30, ------------------------- ------------------------- 2004 2003 2004 2003 -------- -------- -------- -------- REVENUES $ 11,498 $ 10,176 $ 22,188 $ 23,258 COST OF REVENUES 4,233 4,210 8,002 12,117 INVENTORY RECOVERY - (452) - (1,800) -------- -------- -------- -------- GROSS PROFIT 7,265 6,418 14,186 12,941 -------- -------- -------- -------- OPERATING EXPENSES: Research and development 2,127 2,183 4,158 4,301 Sales and marketing 2,536 1,892 5,470 4,154 General and administrative 3,223 2,800 6,398 4,651 Amortization of other intangible assets 711 339 1,422 438 Acquired in-process research and development - - - 1,100 Restructuring charges (8) 2,496 (59) 2,651 Gain on sale of assets and related royalties (500) (4,332) (1,000) (4,332) Amortization of deferred compensation 345 241 655 540 -------- -------- -------- -------- Total operating expenses 8,434 5,619 17,044 13,503 -------- -------- -------- -------- INCOME (LOSS) FROM OPERATIONS (1,169) 799 (2,858) (562) OTHER INCOME, NET 271 334 510 829 -------- -------- -------- -------- INCOME (LOSS) BEFORE PROVISION (BENEFIT) FOR INCOME TAXES (898) 1,133 (2,348) 267 PROVISION (BENEFIT) FOR INCOME TAXES (190) 29 (1,172) 93 -------- -------- -------- -------- NET INCOME (LOSS) $ (708) $ 1,104 $ (1,176) $ 174 ======== ======== ======== ======== Basic earnings (loss) per share $ (0.03) $ 0.06 $ (0.06) $ 0.01 Shares used in computing basic earnings (loss) per share 20,259 19,469 20,074 19,733 Diluted earnings (loss) per share $ (0.03) $ 0.05 $ (0.06) $ 0.01 Shares used in computing diluted earnings (loss) per share 20,259 20,807 20,074 20,635 PCTEL, INC. CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED, IN THOUSANDS) June 30, December 31, 2004 2003 --------- ------------ ASSETS CURRENT ASSETS: Cash and cash equivalents $ 101,451 $ 106,007 Restricted cash 278 278 Short-term investments 1,861 19,177 Accounts receivable, net 7,403 3,630 Inventories, net 3,367 1,267 Prepaid expenses and other assets 3,491 1,929 --------- --------- Total current assets 117,851 132,288 PROPERTY AND EQUIPMENT, net 4,528 1,197 GOODWILL 11,662 5,561 OTHER INTANGIBLE ASSETS, net 9,618 4,140 OTHER ASSETS 70 55 --------- --------- TOTAL ASSETS $ 143,729 $ 143,241 ========= ========= LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $ 1,613 $ 333 Accrued royalties 3,213 3,208 Income taxes payable 5,456 7,359 Deferred revenue 1,832 2,960 Accrued liabilities 5,333 5,739 --------- --------- Total current liabilities 17,447 19,599 LONG-TERM LIABILITIES 366 736 --------- --------- Total liabilities 17,813 20,335 --------- --------- STOCKHOLDERS' EQUITY: Common stock 21 20 Additional paid-in capital 161,842 155,548 Deferred compensation (4,629) (2,552) Accumulated deficit (31,377) (30,201) Accumulated other comprehensive income 59 91 --------- --------- Total stockholders' equity 125,916 122,906 --------- --------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 143,729 $ 143,241 ========= =========