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Technology Stocks : BAY Ntwks (under House) -- Ignore unavailable to you. Want to Upgrade?

To: jkb who wrote (3590)	1/20/1998 10:10:00 PM
From: Anthony Wong	Read Replies (1) \| Respond to of 6980

Dow Jones Newswires: Bay Networks Turnaround On Track; Cites 2Q Switching Sales January 20, 1998 9:27 PM By Mark Boslet PALO ALTO, Calif. (Dow Jones)--Bay Networks Inc. (BAY) said its turnaround remains on track as second-quarter switching sales continued to grow and growth in the second half of the fiscal year should accelerate. The Santa Clara, Calif., supplier of networking equipment also said it would unveil a new generation of its popular BayStack 350 switch on Wednesday. Analysts expect the company to release a lower priced version of the already low-cost switch as Bay seeks to compete with Cisco Systems Inc.'s (CSCO) recently introduced Catalyst 2900 family. During the past several quarters, Bay has seen its fortunes more closely linked to the sales of its switching products, particularly its BayStack 350. Switching continued to the set the pace in the second quarter, accounting for 33% of revenue and surpassing hubs as the company's principal product line. For the quarter, the company posted revenue of $644.9 million, up from $514.5 million in the year-ago quarter and matching Wall Street's target for the period. Earnings were 22 cents a share, including a charge, and 27 cents on an operating basis, which beat analysts' forecasts for 26 cents. Perhaps of greatest interest to followers of the company was Bay's Accelar product line, a next generation routing/switching that analysts look to for future growth. Bay starting shipping the product in December and told Dow Jones that orders are "on track." On a conference call with analysts, the company said it plans to increase production capacity for the product from hundreds of units in the second quarter to thousands of units in the third quarter. On the call, Bay also told analysts that international sales were strong in the second quarter, accounting for 59% of revenue. In an interview with Dow Jones, Bay went on to say it expects its year-over-year growth to accelerate in the second half of its fiscal year, despite some seasonally toughness in the third quarter. -Mark Boslet; 415 496-1366 smartmoney.com