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Technology Stocks : Applied Materials No-Politics Thread (AMAT) -- Ignore unavailable to you. Want to Upgrade?

To: Gottfried who wrote (1623)	7/18/2002 9:06:14 PM
From: Proud_Infidel	Respond to of 25522

Some positive news from Techland...... McData CFO:'Encouraged' By Tech Spending In 2nd Quarter, Early 3rd Quarter By: Tom Locke, Of DOW JONES NEWSWIRES DENVER -(Dow Jones)- McData Corp. (NasdaqNM: MCDT - News) beat second-quarter expectations for revenue and profitability largely on the strength of sales of its new 2-gigabit- per-second product line, said Chief Operating Officer John Kelley in a conference call Thursday. Kelley said the company is seeing a lot of demand so far in the third quarter and has a strong pipeline of sales for its switches and higher-end directors. Those are used in storage area networks, which are used to store computer data. "We got our 2-gigabit products out and they immediately started selling," Kelley told Dow Jones after the conference call. On Aug. 1 Kelley will take over the chief executive position from Jack McDonnell, who will remain as chairman. Kelley said the new 2-gigabit technology will help McData take market share in the lower-end switch market, because its previous 1-gigabit-per-second technology didn't sell well against the 2-gigabit technology offered by the competition. "It gives us a chance to fight" in the switch market, he said. Kelley said he doesn't foresee big changes when he takes over as chief executive. However, he said, the company is "really going to focus on the customer side of it," and there will be plenty of focus on reestablishing the McData brand. He feels it still needs to emphasize the brand in the wake of its formal ownership split from EMC Corp. , which is its biggest customer. Kelley noted that some reductions in the company's work force have continued. On Wednesday, 41 positions at the company's headquarters in Broomfield, Colo. , were cut, he told Dow Jones. McData posted a second-quarter net loss of $3.9 million or 3 cents a share, versus net income of $3.4 million, or 3 cents a share, a year ago. On a pro forma basis - excluding non-cash charges tied to deferred compensation and amortization and the positive impact of 1-gigabit inventory sold that was previously reserved - McData posted a loss of $2.6 million, or 2 cents per share. That compared favorably with guidance on April 18 of a loss of 6 cents to 8 cents a share. The Thomson First Call consensus estimate was a loss of 7 cents a share on a pro forma basis. Second-quarter revenue of $77.3 million also came in ahead of April 18 guidance, which was for revenue to be roughly comparable to the first quarter's $64.5 million. For the third quarter, McData said it expects revenue of $83 million to $84 million and a pro forma loss of 1 cent to 2 cents a share. That's better than the Thomson consensus estimate of a loss of 5 cents a share. The strong second-quarter sales of 2-gigabit products were partly due to pent- up demand from the first quarter, executives said. The 2-gigabit products made up 30% of combined 1-gigabit/2-gigabit sales, as opposed to an expectation of 10%. In the third quarter, the split is expected to be 80% 2-gigabit products and 20% 1-gigabit products.