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To: JakeStraw who wrote (6477)	2/9/2001 7:12:29 PM
From: tinkershaw	Read Replies (2) \| Respond to of 10934

DS, Well yes and no. Remember financial statements are nothing more than presentations by a company. Now I'm not suggesting funny business, but believe me the first place problems usually show up are on the financial statements. Accountants are a crafty lot... Jake, indeed many things can be hidden in financial statements worthy of analysis. Citrix last year is a prime example of this. 3 consecutive quarters of balance sheet and income statement metrics deteriorating, yet explained away as nothing by management. It was particularly blatant due to the otherwise booming economy. However, I think your taking NTAPs current quarter out of context. The economy has hit a brick wall. No doubt NTAPs balance sheet reflects much of this slow down and does indeed evidence a much more difficult quarter. However, in context, NTAP did superb. They survived this quarter with only a little stretch and will probably survive next quarter with only a little creativity as well. To use a balance sheet to discourage you from buying an NTAP, at these prices, particularly given the current economic situation, is to put blinders on the totality of circumstances. So yes, if the economy was blistering, and the EMC threat was looming, a deteriorating balance sheet could speak volumes. Particularly if the deterioration became systematic for 2 to 3 quarters. The balance sheet can tell you scores of between the line information. This, however, is not one of those times, and is not the case with the current quarters results. As DS stated very well, balance sheets are made by great companies, in great markets, with great sustainable advantages. NTAP is one of those companies. Don't read too much into this quarters balance sheet. It might be more helpful to see the improvement in the last 4 quarters balance sheet metrics than it is to read too much into this quarters balance sheet; as this quarters metrics are abberational and due to macroeconomic circumstances beyond NTAP's control and not a loss of managerial control, loss of competitive advantage, nor deterioration in the markets the company is addressing. Tinker P.S. If anything, given the very difficult economic circumstances, this quarter has given me more confidence in NTAP than any other quarter in a history of stellar quarters going back years.

To: JakeStraw who wrote (6477)	2/9/2001 8:08:04 PM
From: EnricoPalazzo	Read Replies (1) \| Respond to of 10934

believe me the first place problems usually show up are on the financial statements. Accountants are a crafty lot... Absolutely true. Like most devotees of The Gorilla Game, I'm primarily interested in thinks like product, market, TALC, value chain, etc. At the same time, you're right; financial statements can be a great tool for finding breakdowns in a company's operations. It's always nice to have people that can point those problems out, and help the rest of us. However, just remember that our goal here is to learn and teach gently. I for one respect most those who can disagree respectfully, and engagingly. Having looked at the problems with their financial statements, I'm not overly worried (management's explanations have seemed reasonable), but will keep an eye out for it next quarter. I would suggest (and I mean this in the same polite tone that you claim to have intended for DS) that you study up a bit on The Gorilla Game and, especially, The Innovator's Dilemma. This should give you a better understanding of why many of us are so enthusiastic about this company's prospects. Ethan