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Technology Stocks : Applied Magnetics Corp

APM 1.300

-2.3%

Dec 12 9:30 AM EST

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To: EyeDrMike who wrote (10856)	12/8/1997 7:43:00 PM
From: Brian Lempel	Read Replies (1) of 12298

Mike, not to beat it to death, but here is the paragraph: Net sales and gross margins in the fourth quarter of fiscal 1997 were negatively impacted by lower yields on newly qualified magnetoresistive (MR) programs and 1.7-gigabyte-per-3.5''-disk inductive thin film products, which were in their first full quarter of volume production. It very clearly says that margins were negatively impacted by low yields on 1.7 GB TFI heads, since that was the first quarter of production. Also, I want to point out that to those who believe APM cannot raise margins that they are just beginning to implement the pico-form factor. The move to lower sub micron technologies will allow them to effectively double their output. Yes, this will not translate to double the efficiency or margins, but it allows them to offer TFI heads at a lower price, making them more cost effective to customers, and allowing APM to produce more profit. Brian

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