Alvarion posted relatively flat sales and widening first-quarter losses despite an uptick in WiMAX revenues.

The company posted a net loss of $852,000 in the first quarter compared to a loss of $601,000 last year on a 1 percent increase in revenue, which hit $67.9 million in the first quarter. Although WiMAX shipments held steady at $40.6 million, the company’s WiMAX-related revenue rose almost 30 percent to $50.9 million on sales recognized from prior shipments.

However, WiMAX shipments fell 30 percent on a sequential basis. The company attributed the drop to the ongoing credit crunch and regulatory hurdles.

“We have not seen any diminished interest in WiMAX as a technology, but we have seen projects delayed due to availability of financing as well as due to hesitation on the part of well-funded companies intent on conserving cash. A few other deployments have been postponed or put on hold, mainly for regulatory reasons unrelated to the economy. As a result, WiMAX shipments declined 30% sequentially from the record level of Q4,” said Tzvika Friedman, president and CEO of Alvarion, in a statement.

The company expects order patterns and shipments to improve next quarter, but forecast widening losses due to a sequential decline in revenue because of weak sales earlier in the year. Based on expected revenue between $54 million to $62 million, the company expects per-share results to range between a loss of 3 cents and 9 cents before any one-time charges.

However, the company said things should improve after the second quarter. Friedman cited order backlog and unrecognized revenue from prior shipments totaling over $100 million. He also expects overall market conditions to improve for the company.

“… Many customers are planning multi-year network buildouts; we have recently won new projects; we are well positioned to take market share from weak competitors; government stimulus programs are targeting broadband as a key area for economic development; additional licenses are expected to be granted in key regions during the next 12 months; and new vertical markets such as video surveillance and traffic management are gaining traction and represent incremental opportunities,” Friedman said.

Alvarion’s shares fell slightly in early morning NASDAQ trading, to $3.18 from its opening price of $3.24 as of 9 a.m. Central time.