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Technology Stocks : Newbridge Networks

NN 11.97

+5.4%

Nov 21 3:59 PM EST

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To: Luc Glinas who wrote (3044)	2/3/1998 8:24:00 PM
From: Derrick Burry	Read Replies (2) of 18016

Feb 03, 1998 (6:03 PM ET) - The Motley Fool Evening News Canadian broadband datacom products company Newbridge Networks (NYSE:NN - news) was cut $5 1/2 to $20 after pre-announcing a significant earnings shortfall for its fiscal third quarter. Newbridge stated that before cumulative one-time charges and gains, it expects to report Q3 EPS of $0.07 (after currency translation based on the average exchange rate of 0.7006 for the quarter) versus expectations for $0.24. The company attributed the looming Q3 drop to a "significant sequential decline" in revenue for time division multiplexer (TDM) systems, an "older" platform technology employed by phone companies to transmit large amounts of data across networks (the company has roughly 40% of the $15 billion TDM market). TDM sales fell to $91 million compared with Q2 sales of $133 million. With more and more companies moving to packet-based wide area network products (like ATM and frame relay) and roughly 50% of the company's revenues coming from ATM, investors would be wise to assess Newbridge's future in terms of its ATM Portfolio

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