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

To: Michael Coley who wrote (6464)	5/24/1998 2:23:00 PM
From: Richard James	Respond to of 7685

Michael Coley, 1. You seem to assume that any CPQ OEM deal would be for Sparq and not Quest, which Syquest has announced will not go into production until it has an OEM deal. 2. You should consider that an OEM deal with CPQ could accomplish economies of scale and the increased value and good will added to all Syquest products by inclusion by a major OEM. 3. What is the basis for your statement that Syquest continues to lose market share to Iomega? Isn't it true that Iomega is losing market share to Syquest? Richard James Richard James

To: Michael Coley who wrote (6464)	5/24/1998 3:43:00 PM
From: Richard James	Read Replies (2) \| Respond to of 7685

A post from Yahoo re Insider Trader Recommendation <<5/15/98 Update #4 $2.13 Q2 Meets Expectations. Still A Speculative Buy. SyQuest Technology (SYQT) reported quarterly results for the period ending March 31, 1998. Net revenue for the quarter increased by 180% to $47 million from $16.8 million for the comparable period last year. Even with this impressive revenue growth, however, SYQT still reported a substantial net loss of $31.7 million. But this was better than the net loss of $34.4 the company had last year, and also better than the $36.2 million net loss posted in Q1. Importantly, SyQuest's reduced its negative gross margin to -11% this quarter, which was much better than the -26% gross loss last quarter. Edward Marciano, SYQT Chairman, said, "Our improved financial performance resulted from increased revenue and greater efficiencies which contributed to a lower negative gross margin. The sharp increase in net revenue resulted from the strong acceptance of our new 1-gigabyte SparQ storage solution." Comparing gross margin losses may seem like grasping at straws for anyone just being introduced to this speculative investment, but selling product below cost has been part of SyQuest's game plan for competing in the hyper-competitive market for removable computer-storage products. Building sales volume is critical for realizing production efficiencies that will eventually make profits possible. How much longer will gross margins be negative? "We anticipate an end to the gross losses next quarter," says Chet Brown, a SyQuest VP. "Production yields of our SparQ are above plan, and yields on other products continue to improve." This does not mean that SYQT will finally generate positive EPS, however. Operating expenses will still likely overwhelm any gross profit the company generates, but it is the first step to turning SyQuest's income statements into something investors won't wince at. Another important milestone should occur in July. "We have achieved volume goals for both the SparQ and SyJet to qualify for price breaks from our component suppliers," informs Mr. Brown. These were prenegotiated price breaks, and depend on SyQuest keeping up present production run rates. Whether or not this means SYQT could have a profitable Q4 (ending September 30), isn't certain, but we do not expect it to be. With $17 million in the bank, SyQuest does not expect to to have to undertake another round of financing this quarter. The conversion of outstanding warrants is expected to generate enough cash to keep the company liquid for at least the next few months. On a sour note, Bob Corey, SyQuest's Chief Financial Officer, recently announced his resignation to pursue a position with Forte Software. Seeing a CFO leave, especially at a company where financing is so important, is never nice to see. We note, however, that Mr. Corey has changed jobs a few times over the past two years, and is understandably enticed when better compensation packages are offered. His departure doesn't appear to be that of a person fleeing a sinking ship. With SYQT down to $2.13, this position is obviously a terrible loser for us now. The recent sell off from its $3 base surprised us given the improvement in gross margins, and management's expectations of a gross profit in the present quarter. The news that a French court threw out Iomega's assertion that SyQuest was infringing its patents is hardly bad news either. There are rumors that some sort of arbitrage activity may be causing the weakness in SYQT, but it's unconfirmed. In hindsight we definitely got in much too early with SyQuest, but we are sticking with this loser given its trends in sales and gross margins. This is no fluke, as we also believe that the company continues to have some of the best products in the rapidly growing market for removable storage. SYQT is only for speculative investors, however, or active traders. >> SUMMARY Gross Profit This Q Reduced Costs + Increased Margins CFO left for >$ Temporary crash due to arbitrage Richard James

To: Michael Coley who wrote (6464)	5/28/1998 11:13:00 PM
From: Richard James	Read Replies (1) \| Respond to of 7685

Michael, I realize you are far from Syqt greatest fan, but this may interest you - if it isn't a hoax. The following was posted on the Yahoo SYQT board this evening. Thursday May 28, 5:41 pm Eastern Time RESEARCH ALERT - Syquest Technology begun NEW YORK, May 28 (Reuters) - Goldman Sachs said on Thursday it started coverage on shares of Syquest Technology by adding shares to the firm's recommended list. Can you verify if this is for real or not? I suspect its BS. Richard James