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 : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: RetiredNow who wrote (51898)	4/20/2001 12:06:48 PM
From: GVTucker	Read Replies (1) \| Respond to of 77400

mindmeld, RE: But I don't enjoy debating with most of the others. Now that really hurts.

To: RetiredNow who wrote (51898)	4/20/2001 1:57:43 PM
From: Eric	Respond to of 77400

MM Finally got a chance to sit down and respond to this inventory problem. Chambers and especially the marketing dept wanted to satisfy customers who couldn't get some equipment in a timely manner and that has put a lot of pressure on component manufacturers in the last two years. So we had a good horse race leading up to summer. Most (but not all!) component lead times were dropping but for some of Cisco's highest margin products with the greatest demand they were still facing shortages of 24 weeks and sometimes more. So Cisco "pushed" the suppliers by forward ordering trying to get critical components. This has been going on for quite awhile through the tech boom. I know Chambers wants to be number one or two in their critical growth markets but I have to admit they were gambling and ended up coming short when the demand dropped off. A great gamble but they lost. Their number one goal was to satisfy customer demand. Sometimes when there's a feeding frenzy you have to take chances and I probably would have done the same thing in Chambers place. Looking at the inventory that they have "secured" I would hazard a educated guess that approximately 3/4th's of that 2 billion will get used within the next year and the remainder will be useless. I understand this drives the street and their competitors nuts but the funny thing is this gives Cisco a huge advantage going forward. They just got a few poker chips to play with. Eric