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 : Spectrum Signal Processing (SSPI) -- Ignore unavailable to you. Want to Upgrade?

To: joseph T. Drago who wrote (403)	12/19/1997 2:39:00 AM
From: ECAC Hockey	Read Replies (2) \| Respond to of 4400

<< TI and GoDSP. I think the question to ask is if SSPIF does a competitive product:: >> Spectrum does not compete in any way with Go-DSP. Spectrum is a reseller of Go-DSP's products, ie anyone who buys a DSP board from Spectrum also needs the tools to write code. I've never seen Go-DSP's Code Composer product, but this is simply an add on to the TI compiler, which makes the compiler and code generation easier to do. An analogy, you could use Microsoft Notepad to write a paper, but would probably prefer to use Microsoft Word. This is a good company for TI to acquire, and does not effect Spectrum. As indicted in last quarters conference call, Spectrum's software niche is in DSP algorithms and operating systems, not compiler tools.

To: joseph T. Drago who wrote (403)	12/19/1997 9:40:00 AM
From: lazar921	Respond to of 4400

Joseph>>>In a Dow Jones article dated September 17, 1997, Barry Jinks stated that he expected as much as 40% of revenues in 1999 to come from C6x products. While 40% is an impressive figure, it by no means represents a majority of their revenues, and this comment is looking forward 2 years. These comments only serves to prove that Spectrum has a core line of DSP products and revenue stream right now, and is not dependent on C6x for revenue. Not expecting favorable comparisons in Q1 98? Even if previously announced C6x orders are pushed to Q2 as a result of TI delays this should not cause the quarter to compare negatively. It is unreasonable to expect that the company would announce every order they receive as many are smaller, turn business orders. Additionally, many of Spectrum's customers are in highly competitive businesses, and I believe there have been times due to competitive reasons that the company is not permitted to announced orders or projects as they are prohibitted by their customers from doing so. If one takes the time to re-read press releases from 1996, you will find that several development deals where announced that year. As development deal take time to realize a full product revenue stream, ask yourself if any of these announcements are applicable to revenues being realized today.

To: joseph T. Drago who wrote (403)	12/19/1997 12:16:00 PM
From: lazar921	Read Replies (1) \| Respond to of 4400

Joseph I'm confused about the point you were attempting to make referencing R&D expenses. For the 3 months ending 9/30/97, R&D expenses were $1,209,000 which was only $4,000 less than the same period a year ago. For the nine month period ending 9/30/97, R&D expenses were $2,525,000 which was $490,000 less than the same period a year ago. If you compare the R&D expenses from Q3 97 in relation to the total spent in the first nine months, you will notice that Q3 R&D represents nearly half the total year to date. From what I can recall, historically the majority of Spectrum's R&D spending does in fact occur in the 2nd half of the year. You also expressed a concern about gross margins. As we all know by now, SSPIF has been phasing out low margin Desktop CT business, and placing more of an emphasis on higher margin DSP systems business. As a result of that shift in business concentration, gross margins for Q3 97 were 55%, compared to 48% in the same period a year ago. Since gross margins are increasing, here too, I am confused about your concerns.