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Technology Stocks : Oclaro, Inc. (Avanex-Bookham) -- Ignore unavailable to you. Want to Upgrade?

To: Victor Lazlo who wrote (935)	11/13/2000 11:24:22 PM
From: tinkershaw	Respond to of 2293

Victor, Since I don't see an ignore feature on SI, I'll just manually ignore you. Tinker

To: Victor Lazlo who wrote (935)	11/14/2000 1:10:15 AM
From: r.edwards	Read Replies (1) \| Respond to of 2293

lazo/////We have significantly raised our revenue assumptions for fiscal 2001 and 2002 to $190 million and $345 million from $134 million and $256 million, respectively. Our higher revenue assumptions are/////THERE YOU GO ,MAN! Avanex Reports September Quarter EPS $0.03, Comfortably Above Our $0.00 Estimate Avanex reported September quarter EPS of $0.03 versus our break-even estimate. Total revenues were $34.8 million, up an impressive 80% sequentially and 44% above our $24.2 million estimate. Gross margins showed solid sequential improvement to 44.6% up from 41.2% in June, above our 44.0% estimate. The company is executing ahead of plan on the top and bottom lines as its continues to make progress diversifying its customer base and expanding its product line. New Products Fuel Revenue Growth; Customer Concentration Eases During the September quarter Avanex successfully ramped a number of new products helping to reduce its historically high customer concentration. In the quarter, the company increased shipments of its new PowerMux and PowerExchange products. Sales of PowerMux and PowerExchange combined represented 40% of total revenues, up from 20% in the June quarter. The company’s initial product offering, PowerFilter represented 60% of total revenues. Worldcom (WCOM/$23.94) revenues represented approximately 60% of total revenues, down sharply from an estimated 80% in June. The company further rounded out its customer base with Fujitsu (FJTSY/$99.00), exceeding 10% of total revenues. We estimate a number of other prominent systems companies, including Nortel (NT/$59.81), Sycamore (SCMR/Market Perform/$70.00) and Lucent (LU/$21.00) round out the customer base. Demand Appears Very Strong; Book-To-Bill Slightly Below 2.0 Given renewed industry concerns about telecom capital spending trends we were encouraged by the strong upside revenue performance, the linearity of shipments, the healthy book-to bill ratio (now indicated to be slightly below 2.0) and the significantly increased outlook guidance. Despite investor concerns, demand was exceptionally strong in the September quarter as evidenced by the significant upside revenue surprise. This was further supported by linear shipment trends and a book-to-bill ratio slightly below 2.0. In addition, we were very encouraged by the increased outlook guidance. Management raised fiscal 2001 revenue guidance from approximately $134 million to $190 million. This should quell investor concerns about a broad-based slowdown in capital spending. The Best Is Yet To Come – PowerShaper Expected Ship For Revenues In FY 4Q-01 We remain very optimistic about the outlook for fiscal 2001 as the company moves its new dispersion compensation product, PowerShaper, from pilot production into commercial volumes. We believe this new product may in fact offer one of the largest market opportunities as carriers move to deploy high bit rate, high channel count, long haul networks. The company indicated (on its conference call with analysts) it expects PowerShaper to contribute to revenues in fiscal 4Q-01. PowerShaper should provide an additional top line demand driver as Avanex moves from a single product company to offering a suite of products and subsystem modules. Products Gaining Momentum We view Avanex as an exceptional optical component manufacturer who has developed a suite of products built around unique filtering technology. Avanex initially introduced a dielectric based filter, called PowerFilter, and it has expanded its product offerings to include products based on non-linear interferometer technology. In the June quarter, Avanex recognized initial revenue on PowerMux, its second commercial product. PowerMux is a next generation wavelength division multiplexer product that offers unprecedented performance of 800 channels at 10 Gbps. PowerMux revenues are primarily from Avanex’s main customer MCI Worldcom, but the product is currently shipping to Nortel, Fujitsu and Sycamore Networks. Lucent, Siemens (SMAWY/$111.50), Cisco (CSCO/$52.25), NEC (NIPNY/$100), and a few other companies are at various stages of testing the PowerMux product. PowerExchanger, a “switchless” optical add-drop multiplexer based on PowerMux design principles, is tracking ahead of plan. The company recently shipped this product to Fujitsu and Cogent Communications and recognized first revenue in the September quarter. In looking at the Avanex product portfolio, we expect PowerFilter, PowerMux, PowerExchanger, and PowerShaper to be the key products that fuel revenue growth over the next 18 months. PowerRelay is another exciting product currently under development. PowerRelay is an optical amplifier for long haul applications and a critical piece to future mesh-based optical networks. Raising 2001 & 2002 EPS Estimates On Higher Revenue Assumptions We are raising our fiscal 2001 and 2002 EPS estimates to $0.24 and $0.52 from $0.09 and $0.42, respectively.