Openwave Systems, Inc. (Nasdaq: OPWV)plunged in its first day of trading, dropping 8 1/16 to 79 11/16 amid ageneral slide in technology issues. The drop came despite reports of rosy financial projections from company officials.
Openwave, which was formed by the merger of Phone.com and Software.com,provides Internet-based communication infrastructure software andapplications to communication service providers (CSPs). Openwave’s target customers include wireless and wired network carriers, Internet service providers (ISPs), portals and broadband network providers.
The Redwood City, California-based company said it has more than 150 customers, who in turn have anaggregate of more than 500 million subscribers.
Phone.com and Software.com agreed to the merger in August, saying theywanted to create a software “powerhouse” for their customers.
On Monday, Openwave executives reportedly predicted that revenue for the quarterending in December will be 20 to 25 percent above the US$80.8 million reported by thecombined companies for the September quarter. License revenue will make upabout 70 percent of total revenue, reports said.
Management also reportedly predicted revenue for calendar 2001 at $580million, and forecast an operating profit for the quarter ending in March,ahead of previous forecasts for reaching operating profit in December 2001.
Openwave is counting on expected explosive growth in the market for wirelesssoftware and products. The company provides wireless Internet infrastructureand browsers, unified messaging, mobile e-mail, directory services, voiceprocessing, synchronization and instant messaging.
Phone.com reported a 62 percent increase in revenue for the quarter endedSeptember 30th, to $46.5 million, as the company posted a net loss of $4.9million, or 8 cents per share. For the same period, Software.com saw revenuesurge 196 percent to $37.6 million, with net income of $499,000, or a pennyper share.