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May 9, 2007

More on Clearwire's Q1 results

Posted by Tricia Duryee at 10:55 AM

Kirkland-based Clearwire reported its first-quarter financial results last night at 9 p.m., just giving me enough time to get something in today's paper.

You can read the high-level results here.

Ten hours later, at 7 a.m. this morning, Clearwire executives talked with Wall Street analysts to discuss the results. That Webcast can be found here.

In general, Clearwire, which is working on building a nationwide WiMax network, sounded a little defensive based on concerns that it will have to raise more than a billion dollars more to make a significant dent in its plans.

It did a thorough job making a case for how fundraising and building a network from the ground up can be possible.

CEO Ben Wolff said the company's plan is to be able to reach 125 million customers in the next five years, but if need be , it can scale back that plan and reach profitability sooner.

John Butler, Clearwire's CFO, said to count on increasing expenses and losses for some time, but "they aren't any different than any predecessor wireless carriers."

Since the company's inception, it has raised $2 billion in capital and was able to raise $600 million in its public offering. It has $1.5 billion in cash and short-term investments.

"We have consistently demonstrated to have access to markets, and will tap that market soon for additional funding," Butler said.

Butler added that if the terms were not favorable, Clearwire can adjust its roll-out schedule, conserve cash and become profitable much sooner if it needed to.

Still, that argument didn't seem to sway the stock market. In early morning trading today, the company's stock continued to slide, decreasing 73 cents, or about 3.8 percent to $18.27 a share.

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Tricia Duryee
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