WDC/Sandisk Corporation Message Board

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Technology Stocks : WDC/Sandisk Corporation

WDC 181.54

+1.1%

Dec 26 9:30 AM EST

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To: Road Walker who wrote (18795)	1/29/2001 6:59:08 PM
From: Sam	Read Replies (2) of 60323

John, I don't understand why my hypothesis presented earlier was ignored: there was double ordering back in Aug/Sept by OEMs who believed both that the holiday season would be stronger than it was and that the capacity shortage would last through Q2 of CY01. These OEMs--among whom I include both Siemens (a 5% customer in the previous quarter) for MMC and Kodak for CF, but there were surely others as well--built up their inventory and found their products didn't sell as well as they expected. The double ordering led Sandisk to continue to manufacture as much as possible and to believe that demand was greater than it really was. Yeah, cameras were a big seller, but SmartMedia and BubbleGum cameras were among the biggest sellers. So the OEMs began cutting back their orders in Dec., then tell Sandisk the extent of the inventory problem in Jan when aftersales don't work as well as expected either. Perhaps I'm being dense here, but something like that seems to me to explain it. s.

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