Novotel Wireless posts 3Q profit on strong MiFi sales, but revenue outlook to fall short

Novotel Wireless posts 3Q profit on higher revenue

SAN DIEGO — Novotel Wireless Inc. posted a net income for the third quarter, reversing last year’s loss, as strong sales of its personal Wi-Fi hotspot device, MiFi, took off.

The provider of wireless high-speed Internet service reported a net income of $6.2 million, or 20 cents per share, compared with a net loss of $1 million, or 3 cents, in the same quarter a year ago. This year’s third quarter was buoyed by a 4-cent per share tax benefit.

Excluding stock-based compensation expenses, Novotel earned $7.7 million, or 24 cents per share, up from $307,000, or a penny per share, last year.

Revenue rose by 20 percent to $94.3 million. Analysts were expecting revenue of $92.6 million and 10 cents per share in profit, according to Thomson Reuters.

Looking ahead, Novotel said revenue in the fourth quarter will come in at $85 million to $95 million. That’s below the $95.7 million expected by analysts.

Earnings after stock-based compensation charges should range from 4 to 12 cents per share, Novotel said. Analysts were forecasting a dime per share in profits.

Shares of Novotel, based in San Diego, fell $2.14, or 17.8 percent, to $9.95 in after-hours trading. The stock was up 22 cents to $12.19 on Thursday.