COMS pre-announced...3Com Announces Preliminary Third Fiscal Quarter
Results; Sales Expected to be Between $1.410 Billion
and $1.415 Billion
SANTA CLARA, Calif.--(BUSINESS WIRE)--March 2,
1999--3Com Corporation (Nasdaq:COMS), a leading global
networking company, today announced that sales for the third fiscal
quarter ended February 26, 1999 are expected to be between $1.410
billion and $1.415 billion. Sales in this range would most likely
result in net income from ongoing operations of approximately $.23
per share.
"Our seasonally weak third quarter was exacerbated by several
factors," said Eric Benhamou, 3Com's chairman and chief executive
officer. "An unexpected slowdown in the U.S. and Latin American
enterprise markets, a weakness in the traditional two-tier distribution
channel, and lower than expected PC OEM sales all contributed to
third quarter results. In addition, adherence to our channel inventory
management practices required that we curtail the rate of our product
shipments into the channel. While we are clearly disappointed with
these preliminary results, they reflect a significant improvement over
sales of $1.25 billion and pro forma net income of $.02 per share(1)
reported in the same quarter a year ago."
The company expects to report complete third quarter results on or
about March 23, 1999.
The information in this release regarding expected third quarter
results is forward-looking and preliminary. Actual final results for
the quarter could differ, depending on the following factors:
accounting adjustments made during the course of closing the
quarter and the roll-up of actual financial data from the company's
various business units and geographies worldwide. For a more
detailed discussion of these and other risk factors, interested parties
should review the company's SEC reports, including 3Com's Form
10-K for the year ended May 31, 1998 and the Form 10-Q for the
quarter ended November 28, 1998. About 3Com Corporation
With more than 200 million customers worldwide, 3Com
Corporation connects more people to information in more ways than
any other networking company. 3Com delivers innovative
information access products and network system solutions to large,
medium and small enterprises; carriers and network service
providers; PC OEMs; and consumers. 3Com. More connected.(TM)
For further information, visit 3Com's World Wide Web site at
www.3com.com or the press site at www.3com.com/pressbox.
3Com is a registered trademark and More connected is a trademark
of 3Com Corporation.
(1) Pro forma net income excludes a net reduction of approximately
$9.9 million to merger-related charges associated with the
acquisition of U.S. Robotics in June 1997. Including this
adjustment, net income was $13.9 million, or $.04 per share
CONTACT: 3Com Investor Relations
Shirley Stacy, 408/326-6301
Shirley_Stacy@3Com.com
or
3Com Public Relations
Leslie Davis, 408/326-7187
Leslie_Davis@3Com.com
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Consensus was $0.36.
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