C-Cube Message Board - Msg: 13608935

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Technology Stocks : C-Cube

CUBE 35.99

-0.9%

10:25 AM EST

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To: DiViT who wrote (49150)	5/7/2000 2:45:00 AM
From: Cameron Lang	of 50808

More Lehman comments posted on Yahoo board... messages.yahoo.com Lehman on CUBE by: sctcom 5/6/00 3:50 pm Msg: 15399 of 15405 FIRST QUARTER REVIEW Revenue in the first quarter (March) was $61.0MM, ahead of our estimate of $57.0MM. Total revenue grew 5% from the same quarter last year. The expansion platforms (which will be our focus going forward) grew 40% year-over-year and VCD (legacy) contracted 20% versus last year. EPS was $0.14, in line with our estimate. Share count was 49.4MM. Gross margin in the quarter was 56.1%, versus our estimate of 57.0%. STRONG PERFORMANCE IN DVD AND SET TOP BOX DVD and set top box were again the key drivers for semiconductor. DVD continued with strong momentum after a seasonally strong quarter in December. The company estimates that the total market for DVD will be approximately 13MM-15MM units in 2000 versus 8MM in 1999. C-Cube believes that they should be able to achieve about 25%-30% market share. PC-DVD revenue was essentially zero in the quarter. This was a planned transition, as the company predicted that this would rapidly convert to soft DVD as microprocessor performance increased. The set top business was also strong in the quarter. We believe this business should accelerate throughout the year and should have a meaningful impact on the overall growth rate for the next several years. Digital deployments are beginning to ramp for Cube in Germany with Nokia, and in Great Britain with Pace. Also, as we have stated before, we see a multi-year cycle unfolding for digital set top box deployments throughout the world. In aggregate, we believe the company's growth platforms (including CODECs) will grow in excess of 40% annually for the next several years. The company projects that the revenue mix will be 70% expansion platforms and 30% VCD in 2000 as measured by revenue.

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