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Technology Stocks : Stratex Networks, Inc. (STXN) -- Ignore unavailable to you. Want to Upgrade?

To: Arrow Hd. who wrote (1526)	7/24/2003 1:52:37 PM
From: Rob Preuss	Read Replies (1) \| Respond to of 1762

I listened too. I'm encouraged by the increase in orders and customer activity... but we're not at all out of the woods yet. I've been amazed by STXN's excellent timing of new product introductions over the years and I think Eclipse is right on target. Eclipse is being introduced just about at the time that new CAPEX spending is coming out of the deepest and longest slump that I've ever seen. I also noted in the call that they said (a) their focus is on Eclipse, (b) they're committed to the Eclipse rollout, and (c) there is nothing on the market today that compares to Eclipse. This is not just a new product STXN is introducing, but a whole new business model for the company; one focused more than ever on services. As Chuck Kissner said: "This will be one of the most dramatic new product cycles in the company's history." The fact is, this one new product platform will - meet capacity needs ranging from 4-311 Mbps, - support all common radio frequencies in use worldwide, - reduce manufacturing costs, - reduce maintenance and operating costs, - reduce parts count, - triple reliability, - provide to the customer a 50% reduction in life-cycle costs, - further drive STXN toward sustainable/renewable service revenues, - enable electronic delivery of SW upgrades, and - permit remote tracking/configuration/control of the customer's installed base. Eclipse is working now, its entering its first customer trial (in Latin America) in 4 weeks, and it will enter its 2nd trial (in Europe) shortly after that. The new platform include 6 technology innovations (patents pending), manufacturers are ramping up (it was designed to be outsourced from the very beginning), and its received a good reception in recent customer visits (both at STXN headquarters in San Jose and at customer sites around the world). This is not just a radio designed to provide individual links... Eclipse has been designed to be a key network component. As one customer said, its a "refreshing change." This is heady stuff for STXN, but you're right that Eclipse won't be generating new revenue (and profits) for the company for another few quarters. In the interim, their older product platforms (XP4, Altium, DXR) are under price pressure from increasing competition. Its crucial that they carefully manage costs and stay close to their break-even levels during the next few quarters. It was encouraging to hear (in response to the 1st question of the Q&A) that STXN was one of 3 winners (among a field of 15) for a significant contract from a large customer in Europe. As we get closer to seeing new revenues & profits from Eclipse, as the world economy recovers from the malaise of the past few years, and as CAPEX spending among telecom service providers builds momentum, I expect we'll see STXN's share price start to rise once again. Patience will pay off. In the interim, buy the dips. Rob