February 23, 2006

PCTEL Posts $22.8 Million In Fourth Quarter Revenue; Finishes 2005 With $77.7 Million In Revenue; Up 61 Percent Over Prior Year

CHICAGO, Feb 23, 2006 (BUSINESS WIRE) -- PCTEL, Inc. (NASDAQ:PCTI), a leader in broadband wireless solutions, announced record revenue for the fourth quarter ending December 31, 2005 and for the entire year. Financial highlights of the quarter and year were:

-- $22.8 million in revenue for the quarter, which is an increase of 49 percent over the fourth quarter 2004. Revenue for the year ended December 31, 2005 is $77.7 million, up 61 percent from the same period in the prior year.

-- $15.3 million in revenue for the quarter from the Antenna Products Group. This is an increase of 56 percent over the fourth quarter last year. Revenue for the year is $54.2 million, up 105% from 2004. The comparisons are favorably impacted by the acquisition of GPS and mobile antenna product lines from Andrew in Q4 2004 and the acquisition of the iVET(TM) product line during the third quarter of 2005. Without those acquisitions, APG revenue increased 28% over the prior year.

-- $2.4 million in revenue for the quarter from the Mobility Solutions Group. This is an increase of 119 percent over the fourth quarter last year. Revenue for the year is up 35 percent over 2004.

-- $4.2 million in revenue for the quarter from the RF Solutions Group. This is record performance for this group and reflects the strong contribution of UMTS scanner sales and growth of the CLARIFY(R) product line. This is a 29 percent increase over the fourth quarter of last year. Revenue for the year is up $3.6 million over 2004 or 33 percent.

-- $0.9 million in licensing revenue for the quarter. This includes the benefit of PCTEL's settlement with US Robotics.

-- A GAAP net loss of $(0.2) million for the quarter, or $(0.01) per share, compared to $1.1 million net income, or $0.05 per share for the same period in 2004. Fourth quarter results last year included $3.2 million, or $0.16 per share, of non-cash income from a one time reversal of a reserve related to the modem product lines that we divested in 2003. Net loss, under GAAP, for the year ended December 31, 2005 was $(3.7) million, or $(0.18) per share, compared to a net loss of $(2.7) million, or $(0.14) per share for 2004.

-- Non-GAAP net income of $2.2 million for the quarter, or $0.11 per share, compared to $2.3 million net income, or $0.11 per share for the same period in 2004. Non-GAAP net income for the year ended December 31, 2005 was $4.5 million, or $0.22 per share, compared to net income of $1.7 million, or $0.08 per share for 2004. The company's reporting of non-GAAP income excludes non-cash based expenses for the amortization of restricted stock awards and amortization of intangible assets related to the company's acquisitions. Those expenses were $2.4 million in the fourth quarter 2005 compared to $1.2 million for the same period a year ago, and $8.2 million for the year ended December 31, 2005 compared to $4.4 million in 2004.

-- $59.2 million of cash at December 31, 2005, up $0.6 million from September 30, 2005.

"PCTEL's management team is encouraged by the company's fourth quarter results," said Marty Singer, PCTEL's Chairman and CEO. "Our organic investments and acquisitions have exposed us to the exciting growth associated with wireless broadband. This includes UMTS, Wi-Fi, WiMax, and the emergence of converged devices. We are well positioned to participate in these markets. Our 2006 focus points are top-line revenue growth, operational effectiveness, improvements in gross margin, and continued development and delivery of broadband wireless products," added Singer.

The company will discuss these results and the market trends driving the increased revenue during its scheduled earnings teleconference today at 6:15 PM EST.

CONFERENCE CALL / WEBCAST

The company will hold a conference call at 6:15 PM EST (5:15 PM CST) today, Thursday, February 23, 2006 with Marty Singer, chairman and chief executive officer, and John Schoen, chief financial officer. PCTEL will not be responding to inquiries regarding its financial results until the conference call. The session can be accessed by calling (800) 289-0508 (U.S. / Canada) or (913) 981-5550 (international).

To listen via the Internet, please visit, www.pctel.com, or http://investor.pctel.com/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 (888) 203-1112 (U.S. / Canada) or (719) 457-0820 (international) access code: 7570147.

About PCTEL

PCTEL, Inc. (Nasdaq:PCTI), which is headquartered in Chicago, is a global leader in wireless broadband solutions. PCTEL's Antenna Products Group (http://antenna.pctel.com) designs, distributes, and supports innovative antenna solutions for public safety applications, unlicensed and licensed wireless broadband, fleet management, network timing, and other GPS applications. PCTEL's Mobility Solutions' (http://mobilitysolutions.pctel.com) software tools provide secure, access independent, remote connectivity to the Internet and VoIP capability for converged handsets. PCTEL's RF Solutions' (http://rfsolutions.pctel.com) portfolio of OEM receivers, receiver based products and interference management solutions are used to measure, monitor and optimize cellular networks.

PCTEL protects its leadership position with a portfolio of more than 130 analog and broadband communications, wireless and antenna patents, issued or pending. The company's products are sold or licensed to wireless carriers, wireless ISPs, distributors, system integrators, wireless test and measurement companies, wireless network equipment and handset manufacturers, PC card manufacturers and government agencies. For more information, please visit the company's 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 the future growth of its broadband wireless products and the emergence of converged devices and operational effectiveness 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 ability to integrate acquired businesses and products. 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     Twelve Months
                                        Ended             Ended
                                     December 31,      December 31,
                                   ----------------- -----------------
                                     2005     2004     2005     2004
                                   -------- -------- -------- --------


REVENUES                           $22,794  $15,298  $77,746  $48,221
COST OF REVENUES                    12,107    7,335   40,878   19,786
MODEM ROYALTY EXPENSE RECOVERY          --   (3,208)      --   (3,208)
                                   -------- -------- -------- --------
GROSS PROFIT                        10,687   11,171   36,868   31,643
                                   -------- -------- -------- --------
OPERATING EXPENSES:
 Research and development            2,548    2,405   10,015    8,614
 Sales and marketing                 3,388    2,948   13,074   11,247
 General and administrative          4,700    4,514   16,836   15,416
 Amortization of other
  intangible assets                  1,170      840    4,137    2,972
 Restructuring charges                  --      129      (70)     (66)
 Gain on sale of assets and
  related royalties                   (500)    (500)  (2,100)  (2,000)
                                   -------- -------- -------- --------
    Total operating expenses        11,306   10,336   41,892   36,183
                                   -------- -------- -------- --------
INCOME (LOSS) FROM OPERATIONS         (619)     835   (5,024)  (4,540)
OTHER INCOME, NET                      502      402    1,546    1,261
                                   -------- -------- -------- --------
INCOME (LOSS) BEFORE PROVISION
 (BENEFIT) FOR INCOME TAXES           (117)   1,237   (3,478)  (3,279)
PROVISION (BENEFIT) FOR INCOME
 TAXES                                  39      173      235     (541)
                                   -------- -------- -------- --------
NET INCOME (LOSS)                  $  (156) $ 1,064  $(3,713) $(2,738)
                                   ======== ======== ======== ========

Basic earnings (loss) per share    $ (0.01) $  0.05  $ (0.18) $ (0.14)
Shares used in computing basic
 earnings (loss) per share          20,257   20,024   20,146   20,074

Diluted earnings (loss) per share  $ (0.01) $  0.05  $ (0.18) $ (0.14)
Shares used in computing diluted
 earnings (loss) per share          20,257   20,179   20,146   20,074



                             PCTEL, Inc.

                Consolidated Condensed Balance Sheets
                      (unaudited, in thousands)


                                         December 31,    December 31,
                                             2005            2004
                                       --------------- ---------------

       ASSETS
CURRENT ASSETS:
   Cash and cash equivalents           $       58,966    $     83,887
   Restricted cash                                208             208
   Accounts receivable, net                    13,725          10,819
   Inventories, net                             9,547           8,554
   Prepaid expenses and other
    assets                                      3,179           2,969
                                       --------------- ---------------
      Total current assets                     85,625         106,437
PROPERTY AND EQUIPMENT, net                    11,190           9,746
GOODWILL                                       31,020          14,114
OTHER INTANGIBLE ASSETS, net                   16,457          11,628
OTHER ASSETS                                    1,217             180
                                       --------------- ---------------
TOTAL ASSETS                           $      145,509    $    142,105
                                       =============== ===============

       LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
   Accounts payable                    $        2,251    $      1,085
   Income taxes payable                         5,297           5,692
   Deferred revenue                             1,944           1,738
   Accrued liabilities                          6,448           9,301
                                       ---------------   -------------
      Total current liabilities                15,940          17,816
LONG-TERM LIABILITIES                           5,542           1,366
                                       ---------------   -------------
      Total liabilities                        21,482          19,182
                                       ---------------   -------------

STOCKHOLDERS' EQUITY:
   Common stock                                    22              21
   Additional paid-in capital                 167,829         160,180
   Deferred compensation                       (7,004)         (4,422)
   Accumulated deficit                        (36,652)        (32,938)
   Accumulated other comprehensive
    income                                       (168)             82
                                       ---------------   -------------
      Total stockholders' equity              124,027         122,923
                                       ---------------   -------------
TOTAL LIABILITIES AND STOCKHOLDERS'
 EQUITY                                $      145,509    $    142,105
                                       ===============   =============



                             PCTEL, Inc.

                 Revenue and Gross Profit by Segment
                      (unaudited, in thousands)


                                     Three Months     Twelve Months
                                         Ended             Ended
                                     December 31,      December 31,
                                   ----------------- -----------------
                                     2005     2004     2005     2004
                                   -------- -------- -------- --------

REVENUES:
---------
APG                                $15,282  $ 9,826  $54,249  $26,451
RFS                                  4,232    3,283   14,343   10,768
MSG                                  2,432    1,109    6,922    5,129
LICENSING                              868    1,100    2,289    5,936
MODEMS                                  --       --       --       --
Eliminations                           (20)     (20)     (57)     (63)
                                    -------  -------  -------  -------
TOTAL REVENUES                     $22,794  $15,298  $77,746  $48,221

GROSS PROFIT:
-------------
APG                                $ 4,319  $ 3,692  $17,604  $10,637
RFS                                  3,119    2,138   10,295    7,177
MSG                                  2,392    1,045    6,762    4,937
LICENSING                              864    1,092    2,207    5,693
MODEMS                                  --    3,208       --    3,208
Eliminations                            (7)      (4)      --       (9)
                                    -------  -------  -------  -------
TOTAL GROSS PROFIT                 $10,687  $11,171  $36,868  $31,643



                             PCTEL, Inc.

     Reconciliation Of Non GAAP To GAAP Results Of Operations (a)
     ------------------------------------------------------------
                      (unaudited, in thousands)


                                  Three Months Ended December 31, 2005
                                  ------------------------------------
                                     As       Non-GAAP          Non
                                   Reported  Adjustments  (a)   GAAP
                                  --------- -------------    ---------
REVENUES                           $22,794                    $22,794
COST OF REVENUES                    12,107           (81) (b)  12,026
MODEM ROYALTY EXPENSE RECOVERY           -                          -
                                  --------- -------------    ---------
GROSS PROFIT                        10,687            81       10,768
OPERATING EXPENSES:
  Research and development           2,548           (97) (b)   2,451
  Sales and marketing                3,388          (240) (b)   3,148
  General and administrative         4,700          (768) (b)   3,932
  Amortization of other intangible
   assets                            1,170        (1,170)          --
  Restructuring charges                 --                         --
  Gain on sale of assets and
   related royalties                  (500)                      (500)
                                  --------- -------------    ---------
       Total operating expenses     11,306        (2,275)       9,031
                                  --------- -------------    ---------
INCOME (LOSS) FROM OPERATIONS         (619)        2,356        1,737
OTHER INCOME, NET                      502                        502
                                  --------- -------------    ---------
INCOME (LOSS) BEFORE INCOME TAXES     (117)        2,356        2,239
PROVISION FOR INCOME TAXES              39                         39
                                  --------- -------------    ---------
NET INCOME (LOSS)                    $(156)       $2,356       $2,200
                                  --------- -------------    ---------

Earnings (loss) per share
  Basic                             $(0.01)                     $0.11
  Diluted                           $(0.01)                     $0.11
Shares used in computing EPS (in
 thousands)
  Basic                             20,257                     20,257
  Diluted                           20,257                     20,854



                                  Three Months Ended December 31, 2004
                                  ------------------------------------
                                     As       Non-GAAP          Non
                                   Reported  Adjustments  (a)   GAAP
                                  --------- -------------    ---------
REVENUES                           $15,298                    $15,298
COST OF REVENUES                     7,335                      7,335
MODEM ROYALTY EXPENSE RECOVERY      (3,208)                    (3,208)
                                  ---------                  ---------
GROSS PROFIT                        11,171                     11,171
OPERATING EXPENSES:
  Research and development           2,405           (29) (b)   2,376
  Sales and marketing                2,948           (85) (b)   2,863
  General and administrative         4,514          (271) (b)   4,243
  Amortization of other intangible
   assets                              840          (840)          --
  Restructuring charges                129                        129
  Gain on sale of assets and
   related royalties                  (500)                      (500)
                                  --------- -------------    ---------
       Total operating expenses     10,336        (1,225)       9,111
                                  --------- -------------    ---------
INCOME (LOSS) FROM OPERATIONS          835         1,225        2,060
OTHER INCOME, NET                      402                        402
                                  --------- -------------    ---------
INCOME (LOSS) BEFORE INCOME TAXES    1,237         1,225        2,462
PROVISION FOR INCOME TAXES             173                        173
                                  --------- -------------    ---------
NET INCOME (LOSS)                   $1,064        $1,225       $2,289
                                  --------- -------------    ---------

Earnings (loss) per share
  Basic                              $0.05                      $0.11
  Diluted                            $0.05                      $0.11
Shares used in computing EPS (in
 thousands)
  Basic                             20,024                     20,024
  Diluted                           20,179                     20,179



(a) These adjustments reconcile the Company's GAAP results of
operations to its non-GAAP results of operations. The Company believes
that presentation of results excluding items such as non-cash
share-based compensation and amortization of intangible assets
provides meaningful supplemental information to both management and
investors that is indicative of the Company's core operating results
and facilitates comparison of operating results across reporting
periods. The Company uses these non-GAAP measures when evaluating its
financial results as well as for internal planning and forecasting
purposes. These non-GAAP measures should not be viewed as a substitute
for the Company's GAAP results. Neither the Company's GAAP nor
non-GAAP results of operations include the accounting impact had the
Company chosen to apply the fair-value recognition provisions of SFAS
No. 123 or SFAS No. 123 revised (123R) to expense share-based
compensation related to stock options, the impact of which is
disclosed in the Company's Forms 10-Q and 10-K as filed with the SEC.
The Company will adopt SFAS No. 123R in its first fiscal quarter
ending March 31, 2006.

(b) This adjustment reflects the non cash stock based compensation
expense for restricted stock grants and stock bonuses awarded to the
Company's employees.



                             PCTEL, Inc.

     Reconciliation Of Non GAAP To GAAP Results Of Operations (a)
     ------------------------------------------------------------
                      (unaudited, in thousands)


                                      Year Ended December 31, 2005
                                  ------------------------------------
                                     As       Non-GAAP          Non
                                   Reported  Adjustments  (a)   GAAP
                                  --------- -------------    ---------
REVENUES                           $77,746                    $77,746
COST OF REVENUES                    40,878          (164) (b)  40,714
MODEM ROYALTY EXPENSE RECOVERY
                                  --------- -------------    ---------
GROSS PROFIT                        36,868           164       37,032
OPERATING EXPENSES:
  Research and development          10,015          (309) (b)   9,706
  Sales and marketing               13,074          (812) (b)  12,262
  General and administrative        16,836        (2,766) (b)  14,070
  Amortization of other intangible
   assets                            4,137        (4,137)          --
  Restructuring charges                (70)                       (70)
  Gain on sale of assets and
   related royalties                (2,100)                    (2,100)
                                  --------- -------------    ---------
       Total operating expenses     41,892        (8,024)      33,868
                                  --------- -------------    ---------
INCOME (LOSS) FROM OPERATIONS       (5,024)        8,188        3,164
OTHER INCOME, NET                    1,546                      1,546
                                  --------- -------------    ---------
INCOME (LOSS) BEFORE INCOME TAXES   (3,478)        8,188        4,710
PROVISION (BENEFIT) FOR INCOME
 TAXES                                 235                        235
                                  --------- -------------    ---------
NET INCOME (LOSS)                  $(3,713)       $8,188       $4,475
                                  --------- -------------    ---------

Earnings (loss) per share
  Basic                             $(0.18)                     $0.22
  Diluted                           $(0.18)                     $0.22
Shares used in computing EPS (in
 thousands)
  Basic                             20,146                     20,146
  Diluted                           20,146                     20,701



                                      Year Ended December 31, 2004
                                  ------------------------------------
                                     As       Non-GAAP          Non
                                   Reported  Adjustments  (a)   GAAP
                                  --------- -------------    ---------
REVENUES                           $48,221                    $48,221
COST OF REVENUES                    19,786                     19,786
MODEM ROYALTY EXPENSE RECOVERY      (3,208)                    (3,208)
                                  ---------                  ---------
GROSS PROFIT                        31,643                     31,643
OPERATING EXPENSES:
  Research and development           8,614          (108) (b)   8,506
  Sales and marketing               11,247          (303) (b)  10,944
  General and administrative        15,416        (1,014) (b)  14,402
  Amortization of other intangible
   assets                            2,972        (2,972)          --
  Restructuring charges                (66)                       (66)
  Gain on sale of assets and
   related royalties                (2,000)                    (2,000)
                                  --------- -------------    ---------
       Total operating expenses     36,183        (4,397)      31,786
                                  --------- -------------    ---------
INCOME (LOSS) FROM OPERATIONS       (4,540)        4,397         (143)
OTHER INCOME, NET                    1,261                      1,261
                                  --------- -------------    ---------
INCOME (LOSS) BEFORE INCOME TAXES   (3,279)        4,397        1,118
PROVISION (BENEFIT) FOR INCOME
 TAXES                                (541)                      (541)
                                  --------- -------------    ---------
NET INCOME (LOSS)                  $(2,738)       $4,397       $1,659
                                  --------- -------------    ---------

Earnings (loss) per share
  Basic                             $(0.14)                     $0.08
  Diluted                           $(0.14)                     $0.08
Shares used in computing EPS (in
 thousands)
  Basic                             20,074                     20,074
  Diluted                           20,074                     20,793



(a) These adjustments reconcile the Company's GAAP results of
operations to its non-GAAP results of operations. The Company believes
that presentation of results excluding items such as non-cash
share-based compensation and amortization of intangible assets
provides meaningful supplemental information to both management and
investors that is indicative of the Company's core operating results
and facilitates comparison of operating results across reporting
periods. The Company uses these non-GAAP measures when evaluating its
financial results as well as for internal planning and forecasting
purposes. These non-GAAP measures should not be viewed as a substitute
for the Company's GAAP results. Neither the Company's GAAP nor
non-GAAP results of operations include the accounting impact had the
Company chosen to apply the fair-value recognition provisions of SFAS
No. 123 or SFAS No. 123 revised (123R) to expense share-based
compensation related to stock options, the impact of which is
disclosed in the Company's Forms 10-Q and 10-K as filed with the SEC.
The Company will adopt SFAS No. 123R in its first fiscal quarter
ending March 31, 2006.

(b) This adjustment reflects the non cash stock based compensation
expense for restricted stock grants and stock bonuses awarded to the
Company's employees.

SOURCE: PCTEL, Inc.

PCTEL, Inc.
John Schoen, 773-243-3000                     
or
Jack Seller (Public Relations), 773-243-3016     
jack.seller@pctel.com

Copyright Business Wire 2006

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