Clearwire Issues "Going Concern" Warning

As required by law, Clearwire has filed an "on-going concern" statement with the Securities and Exchange Commission.

"Our ability to continue to operate our business is substantially dependent on our ability to raise additional capital in the near term," the SEC filing (10Q) says.  "Our expected continued losses from operations and the uncertainty about our ability to obtain sufficient additional capital raise substantial doubt about our ability to continue as a going concern."

The filing notes that during the first nine months of fiscal 2010, Clearwire incurred $1.55 billion of net losses. The company consumed $840.8 million of cash in operating activities and spent $1.96 billion for capital expenditures.

"As of September 30, 2010, we had available cash and short-term investments of approximately $1.38 billion," Clearwire said. "Based on our current projections, we do not expect our available cash and short-term investments to be sufficient to cover our estimated liquidity needs for the next twelve months."

That's why Clearwire has been out looking for debt, equity or spectrum sales for financing. "Without additional financing sources, we forecast that our cash and short-term investments would be depleted as early as the middle of 2011."

"Thus, we will be required to raise additional capital in the near-term in order to continue operations. Further, we also need to raise substantial additional capital over the long-term to fully implement our business plans," the filing says.

read the whole filing here