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Technology Stocks : Lucent Technologies (LU) -- Ignore unavailable to you. Want to Upgrade?

To: telecomguy who wrote (13128)	1/31/2000 5:29:00 PM
From: Techplayer	Read Replies (3) \| Respond to of 21876

telecommguy. It is time for you give it a rest. 15 consecutive quarters of growth, followed by a temporary misstep. Has your precious NT had 15 consecutive quarters of growth? Let's talk in 2 1/2 years. McGinn is a good man. Brian

To: telecomguy who wrote (13128)	1/31/2000 5:39:00 PM
From: Mr.Fun	Read Replies (3) \| Respond to of 21876

This sturm und drang about LU's first quarter is veering into strange territory. Some comments: 1. As if NT has never missed a quarter under John Roth's watch. In December 1999, NT turned in a quarter with 0% YoY growth if you adjust for the purchase of Bay (N.B. add $645M to Dec97 revenues). In March 99 the growth was 4%. In June99 it was 10%. Should Roth have been fired? Wireless revenues were up only 3% in Dec98 and down 3% in March99, against a market that was growing 20%. This is Roth's legacy - should he have been fired? The BUCK ALWAYS stops at the top - Right? (Note to people who do not understand sarcasm - I do not think either John Roth or Rich McGinn ought to be fired) 2. Product transitions can be difficult to manage, and NO company always gets everything right, including Cisco. In the midst of this product transition problem, optical equipment revenues still grew more than 50% YoY - not the 100%+ they were looking for, but then again, NT only grew 80% YoY in the quarter. NT and LU are numbers 1 and 2 in a huge and fast growing market. Number 3 Alcatel is falling further and further behind. LU has alot of good things going on in its optical business. 3. Dan Stanzione, who I know pretty well, wanted to retire early because of health and family issues. He is revered at Lucent and agreed to stay on in a limited capacity due to loyalty. It is silly to suggest he was forced out just because someone happened to notice his reassignment on Yahoo. 4. LU has had a problem with December every year it has been in business as an independent company. Lucent's sales force is compensated on a fiscal year quota basis - meaning you get paid on what you sold as percentage of the quota assigned to you for the year. If you sell too much in the beginning of the fiscal year, your quota gets raised, so the sales force sandbags to the second half of the year, and in particular, September. The incentive to close business in September means there are no easy pickings for December. Of course most of the street doesn't get this, since December is SUPPOSED to be the big quarter (Check out Oracle's revenues in its FY4Q in May if you don't understand the impact of salesforce compensation). So LU tries to stretch and make tough number and when something goes wrong, the Q is so backend loaded, there is no time to do anything about it. Not a good thing, but not a monumental f*** up or evidence the company is broken. Sales force is mighty excited about prospects for a great 2nd half. 4. The WaveStar400G with OC-192 did ship in 1Q, just in such limited quantities that it couldn't make up for deferals of OC-48 orders. It is ramping in this Q and is shipping to customers for revenue in the quarter. By the end of the Q it will be shipping at full capacity. BTW there is a 4 month wait for NT OC192 gear, so its not as though all of these customers can just go get NT equipment. 5. LU at 36 times CY2000 is an extraordinary bargin relative to NT at 74 times or Cisco at 93 times. Where do you think LU will trade after it delivers better than 25% growth in June and September?