Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : JDS Uniphase (JDSU) -- Ignore unavailable to you. Want to Upgrade?

To: SJS who wrote (12641)	9/14/2000 2:57:59 PM
From: pat mudge	Respond to of 24042

Anyway, the vector for efficiency is in the right direction, but wonder about just how labor intensive this business still is... There is a lot involved and you don't switch over to newer processes easily because of all the qualifications involved. No one can throw out all the older machines in one fell swoop. They have to do it gradually as lines are qualified. With reactors, it's even more complicated: each has to be qualified. You could buy five exactly the same and they have to be qualified individually. It's still quite labor-intensive. The goal is to bring in more automation and make each step more productive, i.e., better yields. Because fiber optics is basically being taken from labs (mostly defense contracts) into mass manufacturing, there's a huge gap in packaging. A few short years ago it didn't matter what the yields were. Uncle Sam was writing the checks. Even in the early stages of commercialization --- which, frankly, we're still in --- poor yields have been accepted, but that's changing. Pat

To: SJS who wrote (12641)	9/14/2000 3:28:42 PM
From: pat mudge	Read Replies (1) \| Respond to of 24042

Daily notes from CSFB, Sept 13, 2000: · JDSU hosted upbeat analyst mtg at its Ottawa facility detailing its automation efforts and process improvements which will contribute to the goal of 4x increase in output over 18 mo; JDSU reiterated its plan to reach output targets by expanding physical capacity (expected to reach 5.2M sq ft in total capacity in FQ4:01 from 3.6M in FQ4:00) automation, manufacturing process improvements and outsourcing. · Important area where high level of automation has been introduced is the centerpiece assembly process of coupler manufacturing; JDSU has automated the 2nd and 3rd stages of the mfg process, which has increased output/person by up to a factor of 4; Plans to automate the initial stage of mfg are underway; Production output of centerpieces generated from automated equipment (vs manual) already accounts for a material level of total. · JDSU also highlighted its AutoAligner (3rd gen) which automatically screens centerpieces and aligns fiber to the centerpiece; This system has led to 60% improvement in productivity; Company anticipates integrating AutoAligner with/swept wavelength testing system, which will provide further gains in output. · In optical amplifiers, JDSU utilizes automated fusion splicing in-house (has doubled splice input by factor of 2 over last 12 mo) as well as outsources sub-sassemblies to Celestica; We believe JDSU is in talks w/ a number of addt’l contract manufacturers and could make an announcement in the near-term regarding outsourcing of attenuators. · Separately, JDSU announced mgmt reorganization pursuant to company integration plan which increases focus on key transmission, amplification, DWDM, and switching applications; As anticipated, Sanjay Subhedar (former ETEK CFO) is resigning from the company to pursue personal interests. * Demand fundamentals in optical components/modules remain robust and we believe that JDSU is tracking favorably to our FQ1:01 $750 top-line and $0.16 EPS projections; Continue to view SDLI as inexpensive way to buy JDSU due to 21% arb spread; Reiterate BUY.