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 : Vitesse Semiconductor -- Ignore unavailable to you. Want to Upgrade?

To: robbie who wrote (4165)	8/12/2002 6:14:47 PM
From: The Ox	Respond to of 4710

The current outlook is for more of the same weakness we've been seeing from their end users. They are restructuring and attempting to reduce their breakeven run rate. To be fair, VTSS's R+D was 35 million last quarter and their revenues were 43 million, so they have started their cost cutting and should continue to do so going forward. The main issue is that they used to sell a substantial amount of product to the telecom long haul optical-core market, a sector where capital spending has virtually stopped in it's tracks. Add to the mix that WCOM was the major player in that market. VTSS does have plenty of other products and they have indicated their intentions to focus more of their attention away from the telecom core. The market is discounting the stock to almost 1/2 of book value, an indication that many believe VTSS will continue to bleed for the next year or more. Last quarter pro forma loss was about 20 million, so they need to see demand increase or they need to cut substantially more expense.