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Technology Stocks : 3Com Corporation (COMS) -- Ignore unavailable to you. Want to Upgrade?

To: The Phoenix who wrote (34338)	9/21/1999 5:37:00 PM
From: bgg	Read Replies (2) \| Respond to of 45548

Great operational results, but revenue was down sequentially from a weak Q4. Client access products down from $630 million in Q4 to $539 million in Q1. Of greater interest is the systems business: down from $784 in Q4 to $674 in Q1. Everyone expects the decline in NIC and modem business, but revenue decline in the high growth systems market is not good. COMS' systems business is down because the majority of their business is in the low-end, where prices are plummenting. All in all -- nice surprise with margins, but disappointing sales performance. 3Com is a networker, and I'm not sure if the Street will like a Networker that has revenues going in reverse.

To: The Phoenix who wrote (34338)	9/21/1999 5:58:00 PM
From: Mehrdad Arya	Respond to of 45548

Gary, no matter what COMS does you will always be negative. The BOD apprised shareholders in the 4th. Q of 1999 that they expected a slow down in the Analog Modem and NIC business and they were correct, with a 19% loss. Since this has become a commodity business with low margins the numbers do not effect the bottom line as you might expect, and the results manifest this very well. As you have emphasized in the past, there is a difference between Earnings and Revenue, and what is important is revenues. The earnings report also indicates that the transition to the high growth area is real and not hyperbole. Amen!