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 : Information Architects (IARC): E-Commerce & EIP -- Ignore unavailable to you. Want to Upgrade?

To: deltarider who wrote (4418)	2/12/1998 6:40:00 PM
From: tech	Read Replies (2) \| Respond to of 10786

One thing that you are leaving out is the increase of expenses. You can not just measure the increase in revenues, without also taking into account the increase in expenses to attain those revenues. I don't know what the new number is on how many people ALYD is planning to hire for 1998, but from what I remember Gruder had stated they planed to have approx. 500 employees FYE 1998. Now if we look at the last 10 Q link: sec.gov _____________________________________________- Nine Months Ended 9/30/97 -------------- Operating Expenses =================== Payroll and related costs $9,369,319 Depreciation & amortization 455,329 Other operating expenses 2,403,611 -------------- Total Operating Expenses $12,228,269 With an avg. of 230 employees. _________________________________________________ This works out to approx. $4,526 avg. per employee per month. [ ( ($9,369,319 / 9 months) ) / avg. 230 employees ] Now if ALYD is going to add another 200 or more employees in 1998, that would mean additional $10.8 million in payroll costs alone. (at the 1997 avg. cost rate* of $4,526 per employee)* Another thing to note is the the ever increasing shortage of resources and qualified staff. I think it would be logical to assume that as time goes by ALYD will not be able to keep their cost per employee down and each additional employee hired may have to be paid more and more as resources continue to dry up, and salaries for old employees may also have to be increased to keep them. some companies, like KEA, are using other incentives to make sure they don't lose any of their staff .... and the flood gates haven't even opened yet. link: biz.yahoo.com *'' Keane payed out $1.1 million, or the equivalent of one cent diluted) per share, as an additional 401(K) match for employees.''* Now I am not saying that ALYD won't be profitable, or that they won't have some good growth, all I am saying is that you have to take into account all these different aspects when you are talking about potential growth. It would not be logical to assume that payroll costs in 1998 will be able to be kept at 1997 rates and additional employees would be able to be added at those same rates. link: news.com Any other winners amidst this gloom and doom? "Computer programmers," said U.S. software giant Oracle president Raymond Lane, whose firm had 1,000 open slots for programmers waiting to be filled for the bug problem--among an estimated 200,000 open positions in the U.S. information technology industry. "It is very difficult to keep programmers nowadays. Salaries have gone up by 25 percent in the past year. These technical people could leave a job anywhere in the world and tomorrow start a new job somewhere else," he told Reuters. The same supply and demand forces that will hit the companies who have yet to begin their year 2000 projects, or those who plan to do some of the work internally, will also hit the y2k companies who need to hire additional staff to meet demand for their services. I personally feel that we may see salaries increase by 35 to 50% once the bulk of the work comes in. We can't just look at the revenue side of the equation without looking at the expense side. JHMO.