Gemstar Settlement Lowers S-A’s Earnings

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Despite a 15% jump in quarterly revenue from $459 million to $527 million, net earnings for Scientific-Atlanta Inc.’s fourth quarter ending June 30 dropped from $70.2 million to $34.5 million due to several factors.

The quarter included a $22.2 million after-tax charge related to settlement of a lawsuit with Gemstar-TV Guide International Inc.

S-A also set aside a $20 million reserve in the quarter relating to government investigations into 2000-01 marketing-support agreements with Adelphia Communications Corp. and Charter Communications Inc.

S-A said it sold 1.19 million set-tops in the quarter and 878,000 “Webstar” cable modems that included 343,000 voice units. Almost one-half of the set-tops -- 542,000 -- were digital-video recorders. Shipments of all HDTV set-tops, including DVRs, hit 454,000 units.

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