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Technology Stocks : 3Com Corporation (COMS)

COMS 0.00130

-18.8%

Nov 7 11:47 AM EST

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To: Marcel who wrote (11012)	12/1/1997 5:06:00 PM
From: hitesh puri	Read Replies (3) of 45548

What that precious writer of the Barrons article failed (as usual) to tell the real reason for the $ 15 million sales figure was that 3Com management puposely depleted inventory from the channel and did not count that as a sale. Its the difference in accounting methods which the two companies USR and 3Com adopt that led to this outlook. USR would ship into the channel and count it as sale (like ALTR does) but 3Com counts it as a sale only if the VAR sells it. After the merger 3Com wanted to set things straight so it stopped USR from shipping into the channel till pre-existing inventories were brought down. Hence the USR unit could only show a 15 million sale for those 2 months. C,mon. Can anyone seriously believe demand dropping off 97% within a quarter ?? -hitesh

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