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(REUTERS) Bay Networks, Ascend post better-than-expected profits
Bay Networks, Ascend post better-than-expected profits
PALO ALTO, Calif., Jan 20 (Reuters) - Ascend Communications
Inc. <ASND.O> and Bay Networks Inc.<BAY.N>, two of the biggest
computer network equipment vendors, reported
better-than-expected earnings on Tuesday, mostly on strong
sales of switches.
Bay Networks, the third-largest networking company, said it
had profit from operations of $59.5 million, or 28 cents a
share, compared with a loss of $172.9 million, or 90 cents, in
the same quarter a year ago. With a $12 million charge for an
accounting change, Bay Networks had net income of $47.5
million, or 22 cents a share.
Wall Street had expected Bay Networks, based in Santa
Clara, Calif., to report profit from operations of 26 cents a
share, according to a recent analyst survey by First Call,
which tracks earnings forecasts.
Ascend, the fifth-largest vendor, said its net income
dropped 26 percent to $47.6 million, or 24 cents a share, from
$64.5 million, or 32 cents, in the same quarter a year ago.
But the bottom line for the most recent quarter was better
than the 22 cents analysts were expecting for the Alameda,
Calif., company, according to First Call.
Both companies attributed higher revenue to strong sales of
their switches -- devices that route information through big
corporate or public computer networks.
Bay Networks said its switches now account for most of its
revenue. Previously, most of it came from routers, which are
more complicated, but slower, networking devices.
"It's the new products that are making it happen," said Bay
Networks Chief Executive David House.
Ascend said its sales were weak in Asia but were offset by
strong sales in North America, particularly among large online
services and Internet service providers.
Bay Networks said its fiscal second-quarter revenue jumped
25 percent to $644.0 million from the year-earlier period.
Ascend's quarterly sales rose 2 percent to $292.5 million.
REUTERS
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