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Technology Stocks : SYQUEST -- Ignore unavailable to you. Want to Upgrade?

To: Gary Wisdom who wrote (4836)	11/25/1997 9:18:00 AM
From: Michael Coley	Read Replies (1) \| Respond to of 7685

RE: Breakdown of Iomega's Revenue. OFF TOPIC Gary, Since Iomega doesn't report their revenue breakdown by Jaz or Zip or by drive or disk, there's no way to know for sure. But I think my numbers are pretty close. >> 1. While Iomega had sold 1 MM Jaz and 8 MM Zips, the current sale rate is more like 20 to 1. << I really doubt this. Zip sales have certainly picked up in the past few months, but Jaz sales have too. I think that Zip will be a little more seasonal here in the Christmas season. It's in the right price range to be a good Christmas present, while the Jaz is aimed more towards professionals who buy year-round (and might have a slight spike in January). I stand by my numbers here, but even if they're off by as much as you're saying, that just halves my figures. >> 2. You're assuming that all Iomega revenues/profits come from the sales of drives. This is wrong. A great % comes from discs. And, they sell a lot of discs. << Actually, I didn't make that assumption. I suspect that around 50% of revenues come from disks. But I also suspect that the tie ratios and disk prices are such that the revenue ratios are comparable. For Zip users, I suspect that they buy a $100 drive and $100 of cartridges on average. For Jaz users, I suspect that they buy a $300 drive and $300 of cartridges on average. I'm made the simplifying assumption that Iomega is selling to wholesalers and OEM's at retail, which is obviously wrong. But it shouldn't affect the percent calculations as long as discounts between product lines are comparable which I suspect that they are. It's all guesswork, but I stand by my previous guess than 20-30% of Iomega's revenues come from Jaz drives and disks. >> 3. Regarding Sparq's potential to cut into Jaz sales, who knows? But, they will have minimal impact on Zips. It is a completely different market. << No argument from me here. I think the potential is there, if SyQuest markets the drive right, stays in business, and can ramp up production. Those are some big if's. I agree that SparQ caters to a completely different market than Zip, and that Zip will only feel a minimal (if any) impact. P.S. Are you going to take over the SYQT thread now, too? <G> - Michael Coley - i1.net