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Technology Stocks : SDL, Inc. [Nasdaq: SDLI] -- Ignore unavailable to you. Want to Upgrade?

To: Catcher who wrote (2286)	7/20/2000 7:15:29 PM
From: pat mudge	Read Replies (4) \| Respond to of 3951

2Q '00 Q&A Q: Raman growth for the quarter and any comments on customers? A: Better than 40% sequentially. Expect it to be larger and larger, substantial in 2001. Over ten customers, I believe 13 in all. Some are getting production quantities now. How many? It's only for undersea --- we're doing some custom designs now --- production for 2001 time frame. Also in trials today though no customer has given release (for press). Q: Gross margins, is there room for upside? A: Yes, there's still room for upside. For example we only had PIRI for 4 wks in Q2. Q: Is 3.8 ratio for merger fixed? A: Yes, that's not negotiable. Q: 300 mW pumps, any design wins? What about 10 gig modulators? A: Several for 300mW (about a half dozen wins in quarter. 10 gig, Siemens and several others, in all about 4 to 6 in quarter. Q: Modulators, what variety? A: lithium niobate carries the L band nicely. Looking at other signal beams. LiNi is right technology. Q: Contributions from Veritech and Queensgate versus expectations? Is packaging new? A: All three acquisitions were right on track, but all were more profitable than we expected. Packaging will have 5X increase in capacity. Q: Will you use all capacity? A: We wouldn't build it if we didn't need it. New orders must be long term (to be guaranteed). We are sold out for a considerable time. We will need all or more (capacity growth). New packaging will have many efficiencies. Lower costs, too. Q: IOC, are you ramping customers? A: Small shipments, in low 100s in Q3 and ramping in Q4. Q: PIRI, any deisgn wins besides Lucent? A: Have integrated sales teams and are talking to new customers. 5X progress ag PIRI. ONe new design win from emerging players in optical networking. Q: PIRI, run rate, how has it expanded from Q1 to Q2? A: PIRI --- experienced good sequential growth. Is rapidly growing. Is on track. DSOs -- lineraity did help. Customer satisfaction has improved. Better collection. Expectations? Will be same or lower in 2H. Q: Could you give detail on expansion at PIRI? A: Rev rate comes from facility expansion plus more functions on products. Facilities --- we have leased near existing plan. Adding 55K more sq. feet. Q: New customers? A: A number of new ones b/c of acquisitions. Larger customers are known and have been sampling products over years --- many are coming up in dollar value. Many going from sampling to full deployment. Q: Integration issues? A: Want to get module level quickly. Each has different manufacturing bottlenecks. We can help each other. Q: Arrayed Wave Guides (AWG), is there overlap with thin-film-filters (TFF)? A: They are complimentary. AWGs are for systems over 40 channels and TFFs for systems 16 channel and under. Together we have a complete product. Q: You said growth will be 25% for Q3, will that include acquisitions? A: Yes. I said 25% or better. Q: Demand vs. supply for 980 nm pumps and lasers? A: Pump module --- demand is extremely high. We are turning away business. Ramping to meet demand. 5X is necessary. We can make a lot of chips. Not a problem in that area. Q: Yields? A: 4.7 increase. 2.7 was base, 2.0 was acquisitions. Q: Second and third undersea customers? A: Progressing nicely. Waiting on follow-on for third. We did ship to all three this Q. Three were in the "over 4mil category." Q: Any implications from LU's spin-off of microelectronics unit? A: It's a move which indicates competitiveness in industry. Trernd is towards outsourcing by systems houses. It will accelerate our potential for growth. We will need module-level products going forward. Validates need for merger. Q: Products by %? A: Combined 980 nm over 50%, undersea over 26% of that. Q: PIRI --- any new products there? A: We'll save that discussion for Q3 and Q4. They wre being worked on from internal standpoint. Q: ASP trends in quarter? A: ASP --- seeing standard process. Long term customers get lower prices. No supply issues. Q: Future management of JDSU? A: Our team will move into JDS fold and be active. I'll be in the actives area. Q: New competition? A: GLW ramping volumes 3X in Lasertron. We have great products and can compete. But each product has significant competition. Q: Raman internal projections, market size? A: Difficult to predict. Depends on speed of our customers getting qualified for their customers' systems. Dynamic growth area. Q: Shipments in 2001? A: Already shipping. Market will expand throughout the year. Q: Was the 5X at PIRI? Could you explain. . . A: In victoria it is 5X expansion, going on now; PIRI is also 5X expansion; Veritech is 5X, ahnd IOC and Queensgate, all 5X facility and productivity expansion. Q: Acquisitions, will you do additional deals while merger is pending? A: We are still looking. They will be smaller in size. We will be slowed down some. Q: Which areas are you looking? A: We don't comment because of competition. We don't want our competitors know where we're looking. Summary: Prospects for the company have never been brighter. We're positioned for continued strong results going forward. [Usual thanks to all on call. . .] >>>> Transcribed from CC. All errors are mine. Pat