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Politics : Formerly About Applied Materials
AMAT 339.94+3.3%3:59 PM EST
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To: Gottfried who wrote (32095)8/19/1999 11:11:00 AM
From: Ian@SI  Read Replies (3) of 70976
 
G.,

Please explain the orders backlog shortfall to me.

Earnings beat estimates by almost 16%. This implies at least 10% more "turns" orders during the quarter. On $1.43B of business, this means that AMAT did at least $143M more sales than estimated by the street during the quarter; at most $225M more sales.

When one compares this to the $40M shortfall in expected orders, one can easily see that the growth in AMAT's business was far in excess of the Street's estimate.

And it's equally probable in the current climate that at least as much "turns" business will be done in the current quarter.

In SUMMARY:


    Orders Backlog:  $1.46B
    Turns orders:     0.14B to 0.22B
                     ================
    Total:           $1.60B to 1.68B
    Expected:         1.50B
                     ================
Growth beyond 
expectations.        $0.10B to 0.18B


i.e. - AMAT delivered somewhere between $100M and $180M more orders than the street expected during the quarter. And will probably continue to deliver this magnitude of "turns" type orders during the next few quarters.

What am I missing?

Ian.
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