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To: StockDon who wrote (836)	9/14/2000 12:46:59 PM
From: Scrapps	Respond to of 2404

Some interesting clips from the recent Virata 10-Q... ---------------------------clip----------------------- Our limited operating history in the DSL market makes it difficult to forecast our future operating results accurately. To date, we have not achieved profitability in any quarterly or annual period, and as of July 2, 2000, we had an accumulated deficit of $89.5 million. Although our total revenues have grown in recent quarters, we cannot be certain that our total revenues will increase at a rate sufficient to achieve and maintain profitability. ---------------------------clip----------------------- That was said on August 16, 2000. Now today Virata Pre-Announces Record Second Quarter Revenues. ---------------------------clip----------------------- Semiconductor gross margin decreased to 34.3% for the three months ended July 2, 2000, from 42.8 % for the three months ended June 30, 1999. The decrease was primarily due to the impact of an approximately $1.7 million reserve for our older, lower margin Hydrogen product. This end-of-life transition was successfully completed two quarters earlier than we originally expected, allowing our customers to accelerate the introduction of lower cost solutions. We believe our gross margin may continue to fluctuate as semiconductors become a greater percentage of total revenues, and because increased competition and more consumer oriented markets may impact average selling price. ---------------------------clip----------------------- Don't know if I can buy that semiconductor gross margin excuse in such a booming market where demand is well ahead of supply. Something smells fishy with the semiconductor gross margins. biz.yahoo.com