Third-Quarter Fiscal Results from pdvWireless Announced
Friday, February 08, 2019 | Comments

pdvWireless announced its results for the third quarter ended Dec. 31. Revenue for the company's third fiscal quarter ended Dec. 31 was $1.5 million compared with $1.6 million in the same period of the prior year. Revenue for the nine months ended Dec. 31 was $5.2 million compared with $4.6 million for the same period of the prior year.

The decline in the three-month period resulted from the previously announced loss of one of the company's pdvConnect customers. The increase during the nine-month period resulted from growth in the company's TeamConnect and Diga-Talk product offerings.

The net loss for the company's third fiscal quarter was $8.4 million versus a net loss of $100,000 for the similar period of the prior year. The net loss for the nine months was $32.4 million versus a net loss of $16.2 million for the similar period of the prior year. The additional losses in the three-month period were primarily attributable to the reversal of the income tax provision accrued under the Tax Cuts and Jobs Act of 2017. In addition, for the nine-month period, the loss included restructuring charges taken related to the company's plan to better align its focus and resources to pursue its FCC initiatives and prepare for the future deployment of broadband and other advanced technologies and services.

Cost of revenue for the three months was $1.6 million, a decrease of 20 percent over the prior fiscal year's comparable period. The improvement resulted mostly from headcount reductions and employees reassigned to other areas of the business to support our strategic initiatives as well as lower costs to maintain the 900 MHz network. For the nine months, cost of revenue was $5.6 million, which was relatively flat versus the prior year nine-month period.

Total operating expenses of $8.6 million for the quarter were $900,000 or 12.2 percent higher than the three months ended Dec. 31, 2017. Total operating expenses for the nine months were $33.1 million and were $11.0 million, or 49.8 percent, higher than the nine months ended Dec. 31, 2017. The primary drivers of the increase resulted from $8.5 million in restructuring charges and $700,000 for the impairment charge taken to reduce the carrying value of the company's radios for the TeamConnect business, as well as $3.5 million for increased costs related to existing headcount in general and administrative and higher consulting expenses related to the company's strategic initiatives.

In January, pdvWireless announced plans to transfer its MOTOTRBO trunked network customers in eight metropolitan markets to two other digital SMR network providers. The company will continue operating trunked facilities in the markets in which customers are being transferred and in other markets in which it holds FCC licenses.

"Our first priority is our regulatory proceeding, where in conversations with FCC staff, we continue to anticipate FCC action on our rulemaking petition soon,” said Morgan E. O'Brien, CEO of pdvWireless. “However, the recent month-long closing of the federal government, including virtually all of the FCC, has no doubt caused a substantial backlog of items requiring FCC attention, including our own."

The company remains debt free with $82.3 million in available cash as of Dec. 31, a decrease of $3.3 million from Sept. 30, 2018. The decrease from the prior period was lower than prior periods due to proceeds from stock option exercises and lower payroll costs, partially offset by continued investments in the pursuit of business and spectrum initiatives.

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