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Technology Stocks : Adaptec (ADPT) -- Ignore unavailable to you. Want to Upgrade?

To: Jim Switz who wrote (879)	1/16/1998 3:16:00 PM
From: isaac	Read Replies (1) \| Respond to of 5944

Jim: Perhaps it has to dow with the lack of sell thru in the distribution channel. They produced what's sitting in the channel, thereby driving up their costs, but they decided not to recognize any revenues from what's sitting in the channel. Isaac

To: Jim Switz who wrote (879)	1/16/1998 3:17:00 PM
From: Charlie Smith	Respond to of 5944

Jim: The 30% hit to earnings on a 10% revenue miss does not surprise me. Think about the nature of the shortfall. They basically reversed $30 million in booked revenue without reversing any corresponding costs. The products had been built, sold and shipped to customers for sale, so all costs were loaded in. Therefore trying to "back out" a margin number on the lost sales is not a useful exercise. It's not the same as a sales shortfall due to sales that were never made. Best regards, Charlie