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Technology Stocks : Seac - Seachange New IPO -- Ignore unavailable to you. Want to Upgrade?

To: PeterBurgess who wrote (276)	7/28/1999 1:04:00 PM
From: PeterBurgess	Read Replies (3) \| Respond to of 431

Seachange's R&D investment. Seachange Concurrent Calendar Q Revenue R&D R&D/Rev Revenue R&D R&D/Rev 1999 Q2 $ 21,333 $ 4,274 20% - - 1999 Q1 $ 20,643 $ 4,120 20% $ 17,676 $ 2,371 13% 1998 Q4 $ 19,233 $ 3,963 21% $ 19,181 $ 2,545 13% 1998 Q3 $ 17,788 $ 3,897 22% $ 16,874 $ 2,704 16% 1998 Q2 $ 16,580 $ 3,900 24% $ 20,200 $ 2,694 13% 1998 Q1 $ 18,169 $ 4,003 22% $ 20,394 $ 2,739 13% 1997 Q4 $ 12,732 $ 3,433 27% $ 21,016 $ 2,694 13% Totals for 97Q4-99Q1 $ 23,316 $15,747 SFA only spends 9-10% of its revenue on R&D. Observations: 1. SEAC spends more than CCUR on R&D both as a % of revenue and absolute $. From 97Q4 to 99Q1 Seac spent 1.48x as much as CCUR. 2. In absolute $ Seac has been slightly increasing R&D investments in recent qtrs, while CCUR has been slightly decreasing R&D investments, so the divergence of their technical assets is increasing over time. 3. SEAC produced tiny profits of $57k and $157k for Q1 and Q2 after choosing to invest its cash into R&D of $4.12m and $4.274m in those quarters. Seac management clearly believes that its R&D return will be significant as nearly every available $ is invested in R&D.