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Technology Stocks : EXLN - Excelon -- Ignore unavailable to you. Want to Upgrade?

To: Bob Trocchi who wrote (535)	7/28/2000 10:40:58 PM
From: hasbeen101	Read Replies (1) \| Respond to of 811

Bob, You provided more detail than I expected! I do share your view about sales & marketing expense. The model seems akin to the "old style" insurance companies that rely on travelling salesmen signing-up each individual customer, instead of the "new style" marketing that relies on multiple channels including direct sales. This model will always be expensive and lacking in scalability ... not that scalability is much of a problem when you are gowing no faster than the average S&P 500 company!

To: Bob Trocchi who wrote (535)	7/29/2000 5:44:22 PM
From: Elsewhere	Read Replies (2) \| Respond to of 811

Bob, here's my take: BT JJ Revenue SW 52M 47.3M Serv. 28M 29.3M total Rev 80M 76.6M B2B share 21.6M (14% more than what Goldman is comfortable with) Cost of rev. SW 2.7M 2.5M Serv. 16.7M 18.3M Total 19.4M 20.8M Gross Pro. 60.5M 55.8M Op. exp Sales/Mkt 42.5M 40.0M R/D 13.7M 13.0M G/A 7.3M 6.9M Total Op E 63.6M 59.9M Income BT (3.1M) (4.1M) Other inc. 1.4M 1.3M Net Income (1.7M) (2.8M) EPS (0.06) (0.10) My projection is top-down. I assume a seasonally weak, i.e. flat Q3 and a top-line growth in Q4 comparable to Q2, about 12%. Sales and mkt as a % of rev. is way way way too high! I don't agree. Many people still don't know eXcelon. Others who know it complain about its low profile, ask Damien. EXLN's percentage is 52% in my model. Ariba had S&M expenditures of $66M on total revs. of $81M in the past quarter, i.e. 81%. I do not have a lot of hope that 2000 will be the profitable year that some people on this thread including myself have been expecting. Profitability is not that important. Here EXLN is doing much better than ARBA or CMRC which are considered to be the "B2B leaders". Top line and especially B2B segment growth is far more important. And in my model EXLN has a "black zero" in Q4, that would be ok for me.