Notes from CC:
Sonus is very cryptic about contract and "selection" activity, so some interpretation is required. They indicated some of their new wins are not reflected yet as orders, they have been "selected". Buyer beware.
- They announced a new government contract, no details provided and may not be reflected in orders yet.
- Had trouble hearing the Book-To-Revenue, think it was even with sales(1.0).
- 16Bmins/mo now traveling over Sonus networks, up from 13B in Q2.
- Selected by several European operators beyond DT, some are reflected in new orders but not yet in revenue or DR.
- Won their first wireless customer in Japan, where they dominate the wireline VoIP business.
- Cingular was 33% of their business in Q3, their partnership with MOT generated almost 10%. Only some of their wins with MOT are reflected in the numbers.
- Beyond DT, additional operators in Europe and NA have selected the GSX4000, including some customer that are new to SONS.
- Top 5 customers were 61% of business vs. 68% in Q2. 47 total customers in Q3 vs. 39 in Q2. There have been several followups by analysts indicating some of the new customers are the initial phases of very large scale deployments.
- 674 employees, up from 625 in Q2. Majority of additions in engineering and support.
- Their "shipped and billed, but not in DR yet" metric went to $7.7M in Q3 from $4.9M in Q2.
- Recently have been "selected" for several large scale deployments not reflected in any numbers yet.
- Basic guidance is for 2H05 to be somewhat ahead of 1H05.
- During Q&A, expanded a little on new, unannounced customers. Several Tier1 carriers outside the US are in deployment. Several European operators have selected Sonus. The new wireless customer in Japan was a direct sale.
- Even as the new deals get bigger, they are maintaining their LT gross margin forecast of 58-62%.
- Gave some indications the 2 Tier1 service contracts that were extended into Q4 from Q3 were renegotiated as part of new orders at these carriers.
- On questions about Lucent IMS win at BLS, seemed to focus the answer that these are multi-vendor deals and many parts of these new networks are bid individually. Did not say they lost the softswitch at any of Lucent's 3 recent IMS wins, just as Lucent would not say they won any of them. |
