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To: LLCF who wrote (1295)	11/6/1997 9:54:00 AM
From: Juniper	Read Replies (1) \| Respond to of 2946

Some impressions- 1) The new Korean customer- I don't believe this is either Samsung, LG, or Hyundai, since I have old notes stating they were customers at the time. 2) The 35->50 bays issue. If this isn't already resolved, my impression from postings of the latest CC(particularly Sam Citron) is that these are test bays, and that the cycle time for this step should be reduced to 3 months. This along with 50 bays == 200 MS/year. The total time to produce a MSIII is probably a whole lot longer than this, and likely only partially affected by any improvements to happen with the bays. 3) The reluctance of Russ Weinstock in the CC to provide any guidance for SVGL production in 98. This may not be out of character, but it is somewhat bothersome to me that he didn't give any reason for not providing guidance. Joby's comment that he laughed several times when asked about 98 capacity was interesting(I wish I had listened to the CC..) - I'll speculate that he laughed because he had no intention of giving guidance and perhaps he was laughing about current analyst predictions, which was all he would give. The latter makes sense to me. David Aegis stated that he repeated the '99 guidance of 200/yr(or 50/qtr) at the start of FY 99. In order to do 50 in Q1 '99 and yet do under 75 for FY98(per analyst estimates of 55-75) the production ramp would need to be very mild first half 98 and very steep second half 98. I plotted possible numbers(13, 14, 16, 31)which could satisfy under 75 requirement and still get SVGI to 50 in Q1 99. It seems unlikely to me that the ramp would be this steep. My choice would be to say either the 98 estimates are wrong or the 99 guidance is wrong. I'm favoring both right now - too low and too high respectively. 4) Why should SVGI be willing to give production estimates for 99 but not 98? Are there competitive reasons for not giving short term estimates? I do know that customers like vendors which are going to be solid and strong into the future. I'm just going to speculate that the 99 numbers are real goals, but are inflated above reality to make customers more willing to place orders now. I'm not sure, but the lack of guidance makes me somewhat suspicious. Plus, the company hasn't been wonderful about always getting products out on time, so these things make me think the ramp won't be complete until maybe mid 99 vs beginning 99. Regardless, I believe the ramp will be steep in 98, particularly in Q3 and Q4. The timing of this might make guidance difficult as well. I don't expect to hear anything useful on how it's going until starting with Q2 earnings report/CC. My pure guess at numbers I used to make a pretty graph were- FY98 14, 17, 26, 35 FY99 44, 48, 51, 53. 5) Facts - as far as I can tell, guidance about the ramp up has been consistant and unchanging so far. They've been saying 200/yr by 99, and it's still the guidance. I looked back at posts on the March 21 CC and saw Dave Grady mention that SVGL expected to do a little over 40 Micrascans in 97, which is what they've done(I'd guess ~45). I also found at techweb(usually a great source for innacurate information..!) a direct quote of Papken(february 97), something along the lines of, "we hope to ramp up to 12-16/month next year". I'm just using this as meaning 12-16 in the last months of FY98, which seems consistant as well. Good luck all-