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Technology Stocks : SYQUEST -- Ignore unavailable to you. Want to Upgrade?

To: Joon Song who wrote (5632)	2/22/1998 3:30:00 AM
From: Andrew Shih	Respond to of 7685

>>As the legacy cartridge revenue continues to shrinks down to zero, I think SyQuest's gross margins could actually get worse in the coming quarter. (Consider they're already negative 25%, that would be quite a feat.)<< I agree...if the horrible Q4 gross margins were NOT because of SparQ start-up costs, then SyQuest will be dead and buried fairly soon (6 months). If, however, it was from $5-10 million of start-up cost, then the SparQ is SyQuest's last ditch attempt at survival. -Andrew

To: Joon Song who wrote (5632)	2/22/1998 3:58:00 AM
From: Michael Coley	Read Replies (1) \| Respond to of 7685

RE: How Bad Can the Margins Get? >> As the legacy cartridge revenue continues to shrinks down to zero, I think SyQuest's gross margins could actually get worse in the coming quarter. (Consider they're already negative 25%, that would be quite a feat.) << They've done it before. Here are some of their worst margin quarters in recent history: Q2 97: -79.0% Q3 96: -80.4% Q2 96: -53.5% Of course they've had a couple decent ones, too: Q1 97: 22.9% Q4 96: 22.5% But overall, it's a sad story/trend: 1993: 36.5% 1994: 27.4% 1995: 17.0% 1996: -24.1% 1997: -0.7% 1998: -26.7% (Q1) - Michael Coley - wwol.com