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Technology Stocks : Network Associates (NET)

NET 213.48

+2.1%

3:59 PM EST

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To: Chuzzlewit who wrote (5373)	6/19/1999 9:02:00 AM
From: Edwarda	of 6021

I couldn't have said it better myself! Remember, I was not enthused about the announcement of a buyback program, although the stock went up a bit on the news. The CFO also confirmed the lower budgeted revenue run rate following the current quarter, which is aimed at bleeding the channel inventories. In the third quarter, the company expects revenues of $190 million to $195 million, followed by revenues of $200 million to $215 million in the fourth. A couple of other tidbits that might be of interest to you and to the rest of the thread: The inventory in the channel is not obsolete and the company is not dealing with a mess of returns, merely a sell-through problem. Because of the availability of immediate updates, the stuff in the channel is salable and being sold. Progress on moving customer base to the subscription model is pretty good: Anti-virus is about 90% subscription Sniffer is about 70% to 80% Help Desk is about 60% Security is all subscription N.B. The company customarily defers 20% of the revenue of a two-year subscription. Another note: The repricing of employee stock options did NOT include corporate officers.

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