8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 28, 2005

SOMERA COMMUNICATIONS, INC.

(Exact name of registrant as specified in its charter)

Delaware	000-27843	77-0521878
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

301 S. Northpoint Drive

Coppell, Texas 75019

(Address of principal executive offices, including zip code)

(972) 304-5660

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition

Attached hereto as Exhibit 99.1 and incorporated by reference herein is the text of the registrant’s press release, dated April 28, 2005, regarding final financial results for the registrant’s first fiscal quarter ended March 31, 2005. Attached hereto as Exhibit 99.2 and incorporated by reference herein is a series of PowerPoint slides, dated April 28, 2005, utilized by the registrant in connection with its public teleconference call held on April 28, 2005 to announce the registrant’s financial results for its first fiscal quarter ended March 31, 2005.

The information in this Current Report on Form 8-K is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section.

Item 9.01. Financial Statements and Exhibits

(c) Exhibits.

Exhibit No.	Description
99.1	Press Release dated April 28, 2005.
99.2	PowerPoint Slides dated April 28, 2005.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

SOMERA COMMUNICATIONS, INC.
By:	/s/ David W. Heard
	David W. Heard
	President and Chief Executive Officer

Date: April 28, 2005

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release dated April 28, 2005.
99.2	PowerPoint Slides dated April 28, 2005.

EX-99.1

Exhibit - 99.1

Final Draft - For Release after market close at 4:10 EST, April 28, 2005

Contact:	Kelly Delany
	Director, Communications
	1.805.681.3322
	kdelany@somera.com

Somera Announces First Quarter 2005 Financial Results

Q1 2005 Highlights

• Gross profit of $7.7 million or 37% of revenues; up from $6.2 million or 27% of revenues in the fourth quarter 2004

• Operating expenses were $10.8 million, a decrease of 16% from fourth quarter 2004

• Net loss of $3.3 million, a 47% improvement compared to the fourth quarter net loss of $6.2 million

• Three new lifecycle management/asset management projects commenced implementation.

DALLAS, April 28, 2005 – Somera Communications (Nasdaq: SMRA), a global provider of telecommunications asset management services, today announced financial results for the first quarter ended March 31, 2005.

Total revenue for the first quarter of 2005 was $20.5 million, compared with $23.2 million for the fourth quarter of 2004. The sequential decline in sales was primarily due to traditional first quarter seasonality and purchasing decision delays resulting from the recent wave of industry mergers and acquisitions.

Gross profit for the first quarter of 2005 grew to $7.7 million, an increase of 24% over the gross profit of $6.2 million reported for the fourth quarter of 2004. Blended gross profit margin for the first quarter was 37%, compared with 27% for the fourth quarter of 2004. The gross margin increase was primarily associated with higher margins on our international business, new lifecycle services programs and improved product supply chain management.

Operating expenses for the first quarter of 2005 were $10.8 million, compared with $12.9 million for the fourth quarter of 2004. The sequential decrease from the fourth quarter directly reflects the impact associated with organizational changes and expense controls implemented during the third and fourth quarters of 2004 to effectively rebalance the Company’s cost structure.

Somera’s net loss was $3.3 million, or $0.07 per share for the first quarter of 2005, an improvement of 47% over the net loss of $6.2 million, or $0.12 per share, for the fourth quarter of 2004.

Somera’s balance sheet at March 31, 2005 included $35.2 million of cash equivalents and short-term investments, $38.9 million in working capital and no long-term debt.

“Our first quarter results demonstrate that we are making progress toward reaching our target breakeven model and delivering on our four point plan to profitability,” commented David W. Heard, Somera’s President and Chief Executive Officer. “I am very pleased to see our gains in gross profit

dollars and gross margin, and our quarterly operating expenses decreased according to plan. Going forward, we will seek to manage quarterly expenses while continuing to invest in key areas that will support our growing market penetration. This includes further development of our intellectual property in our operating systems and expansion of our global channel for sales, service and supply.”

Continued Heard, “While total revenue was lower than the fourth quarter of 2004, we signed a large Lifecycle Services contract for spares management with XO Communications, initiated a limited market trial for a similar service with one of our Regional Bell Operating Company (RBOC) customers, and began implementation of our Somera RecoveryPLUS^™ program with a top 10 national North America service provider. The positive market response to our service offering gives us confidence in our ability to gain new customers and expand our programs with existing customers. Our pipeline looks promising and our balance sheet provides resources to support our strategic business initiatives.”

“In addition, Somera made several key executive appointments during the first quarter and I believe the Company is solidly positioned with the knowledge, leadership, and sales and service resources to successfully execute our asset management strategy,” concluded Heard.

Teleconference and Webcast

Management will hold a teleconference with simultaneous webcast today at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time) to discuss first quarter results. Please dial 800-510-9691 for domestic calls, or 617-614-3453 for international calls, at least five minutes before start time and use passcode 11010929. The call will be webcast on the Investor Relations page of the Somera web site at http://www.somera.com. Listeners will need to have Microsoft Media Player installed on their computers. A telephonic replay will be available from one hour after the call ends through May 26, 2005, at 888-286-8010 for domestic calls, or 617-801-6888 for international calls, passcode 60318183.

The webcast is also being distributed through the Thomson StreetEvents Network. Individual investors can listen to the call at http://www.earnings.com, Thomson’s individual investor portal, powered by StreetEvents. Institutional investors can access the call via Thomson StreetEvents (http://www.streetevents.com), a password-protected event management site.

About Somera

Somera launched its family of Lifecycle Management Services in 2004 in response to an industry-wide need for telecom asset management to optimize return on assets. Somera’s product offerings enable service providers to generate greater value from legacy assets in the form of lower operating costs, longer product life, higher productivity, and real measurable capital savings. With Somera LifecyclePLUS, customers can outsource elements of network operations, logistics, and technical service. Somera RecoveryPLUS ^™ is a program approach to deliver documented savings and expense relief by recovering hidden value in current underutilized assets and inventories. Somera RepairPLUS provides comprehensive support for wireless, wireline, and data products at significant savings and reduced cycle times. These services are in addition to Somera’s traditional Brokerage business that provides immediate availability of quality, warranted new and refurbished equipment at savings of 25 to 60%. Founded in 1995, Somera has developed an impressive base of over 1,100 customers worldwide, including the industry leaders from each segment of the telecommunications market. Visit Somera on the web at www.somera.com.

This news release contains forward-looking statements as that term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements about Somera’s projected return to quarterly profitability in the fourth quarter of 2005, Somera’s ability to manage quarterly expense levels, continue to invest in key areas, increase market penetration, develop its operating system and make improvements within its global channel for sales, service and supply, Somera’s ability to gain new customers and expand its programs with existing customers in future periods, the nature of the future market environment, and Somera’s customer pipeline. Forward-looking statements involve a number of risks and uncertainties including, but not limited to, general economic conditions particularly affecting the telecommunications industry; capital equipment spending levels in the telecommunications industry, including the risk of continued customer spending delays associated with carrier consolidation; the impact of competition in the market for supplying equipment and equipment lifecycle management services to telecommunications operators; the risk of potential shortage of product supply; and Somera’s ability to build its lifecycle management services capabilities; and other factors fully described in the company’s reports to the Securities and Exchange Commission (SEC), including but not limited to, the Annual Report on Form 10-K for the fiscal year ended December, 31, 2004, and Quarterly Reports on Form 10-Q. Actual results may differ materially from the statements contained in this new release. The company does not undertake to update any forward-looking statements that may be made by or on behalf of the company. Copies of Somera’s SEC filings may be obtained by contacting Investor Relations, Somera Communications, at 1-805-681-3322.

SOMERA COMMUNICATIONS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data)

(unaudited)

	March 31, 2005			December 31, 2004
ASSETS
Current assets:
Cash and cash equivalents	$	6,303		$	7,654
Short-term investments		28,909			32,757
Accounts receivable, net of allowance for doubtful accounts of $557 and $574 at March 31, 2005 and December 31, 2004, respectively		16,710			16,217
Inventories, net		11,472			10,027
Other current assets		2,473			1,876
Total current assets		65,867			68,531
Property and equipment, net		4,593			4,600
Other assets		142			148
Goodwill		1,760			1,760
Intangible assets, net		33			50
Total assets	$	72,395		$	75,089
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	13,854		$	12,396
Accrued compensation		2,750			2,503
Other accrued liabilities		9,925			11,139
Deferred revenue		464			723
Total current liabilities		26,993			26,761
Stockholders’ equity:
Preferred stock ($0.001 par value per share; authorized 20,000 shares, no shares issued)
Common stock ($0.001 par value per share; authorized 200,000 shares, shares issued and outstanding: 50,233 and 49,872 at March 31, 2005 and December 31, 2004, respectively		50			49
Additional paid-in capital		75,131			74,652
Unearned stock-based compensation		(289	)		(72	)
Accumulated other comprehensive loss		(104	)		(191	)
Accumulated deficit		(29,386	)		(26,110	)
Total stockholders’ equity		45,402			48,328
Total liabilities and stockholders’ equity	$	72,395		$	75,089

SOMERA COMMUNICATIONS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(unaudited)

	Three Months Ended March 31,
	2005			2004
Revenues:
Equipment revenue	$	18,804		$	23,012
Service revenue		1,730			5,376
Total revenues		20,534			28,388
Cost of revenues:
Equipment cost of revenue		11,966			17,756
Service cost of revenue		880			4,152
Total cost of revenues		12,846			21,908
Gross profit		7,688			6,480
Operating expenses:
Sales and marketing		5,830			5,639
General and administrative		4,990			4,648
Amortization of intangible assets		17			17
Total operating expenses		10,837			10,304
Loss from operations		(3,149	)		(3,824	)
Other expense, net		114			206
Loss before income taxes		(3,263	)		(4,030	)
Income tax provision		13			26
Net loss	$	(3,276	)	$	(4,056	)
Net loss per share: basic and diluted	$	(0.07	)	$	(0.08	)
Weighted average shares: basic and diluted		49,935			49,519

EX-99.2

Exhibit 99.2

Exhibit 99.2

Somera

equipping networks for life

Q1 2005 Earnings Presentation

David W. Heard Kent Coker President & CEO Chief Financial Officer

Forward Looking Statement

This presentation may include forward looking statements that are based on current expectations that involve risks and uncertainties including, but not limited to, Somera’s gross margin and operating expense levels in future periods, Somera’s expected return to profitability on a quarterly basis and the timing thereof; Somera’s strategy and goals in future periods and the execution thereof; expected stabilization of and growth in revenues; expected market size of the Lifecycle Management Services opportunity; expected areas of future growth and market share gains; Somera’s ability to capitalize and execute on its Lifecycle Management Services strategy; Somera’s ability to execute on LifecyclePLUS, RecoveryPlus and RepairPLUS opportunities; and future customer spending levels. These and other forward-looking statements are based on current expectations that involve risks and uncertainties. Somera’s actual results may differ materially from the forward-looking statements made in this presentation. Factors that could cause actual results to differ include general economic conditions, particularly those affecting the telecommunications industry; capital equipment spending levels of Somera’s customer base, including the risk of continued customer spending delays associated with carrier consolidation; the impact of competition on Somera’s business; Somera’s continued ability to match equipment supply with customer demand; potential shortages in product supply; Somera’s ability to continue its international expansion; Somera’s ability to reduce operating expenses and breakeven revenue amounts; and risks related to its service business, including its lifecycle services offering. These and other risk factors are detailed in Somera’s Annual Report on Form 10-K for the year ended December 31, 2004 and Quarterly Reports on Form 10-Q, filed with the Securities and Exchange Commission.

Somera - Proprietary

Target Breakeven Quarter Model

Target B/E Qtr

(in millions)

Revenue $32.00

Gross Profit % 35% Gross Profit $ $11.20

Op Expense $11.10

Op Income $0.10

Target Breakeven Model*

Revenues $31-33M Margins 34-36%

Expenses Approx +/-$11.0M

Target Revenue Mix $22-23M $1.9-2.6M

$20-21M

Base Quarter

Services & Programs

Brokerage $31-33M

+/- $6-8M

+/- $25M

Target Breakeven Quarter

Somera—Proprietary *Targeted return to profitability on a quarterly basis by the end of 2005

Somera Asset Management Strategy

Disposition Valuation Inventory Analysis Procurement

Professional, Repeatable Programs

Out of Warranty Repair Testing & Refurbishment

End of Life Management Custom Configurations Logistics Management Installation/De-Installation Spares Management

New Equipment Sales Refurbished Equipment Sales Spot Buying

Somera - Proprietary

BROKERAGE SERVICES

RECOVERY PLUS TM

REPAIR PLUS LIFECYCLE PLUS

Somera Recovery PLUS TM

Procurement

Disposition

Valuation

Inventory Analysis

RecoveryPLUS Value Proposition

Provided significant savings over last 10 years. Core competence of Somera Low to no cost risk Guaranteed improvement to ROA

Capital preservation Real dollar savings

Custom disposition options to maximize return Standardized, repeatable processes Business transparency required for SOX compliance Guarantees optimized price for sourcing and selling

Somera Asset Manager

Somera - Proprietary

Business Model

Blended Margin Contribution

Unique Business Model

Leverages service bundle with GP

Base Brokerage 28+%

RecoveryPLUS RepairPLUS LifecyclePLUS

Target Lifecycle Services 40-45%

Utilizes common infrastructure

Spares

Facilities (testing, shipping, logistics) Systems Direct Marketing Sales Customer Care

Stand Alone Brokerage

Recovery PLUS

Repair PLUS

Lifecycle PLUS

Brokerage RecoveryPLUS RepairPLUS LifecyclePLUS

Somera—Proprietary

4 Point Plan to Profitability

Drive growth in traditional equipment brokerage business

Increase international contribution

Establish a leadership position in Telecom Asset Management, resulting in an annuity-based revenue stream Tightly manage business to margins and expenses of new model

Somera - Proprietary