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Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: w molloy who wrote (11417)	6/11/1998 10:20:00 PM
From: Gregg Powers	Read Replies (1) \| Respond to of 152472

w molloy: Sawtek is a component vendor whose products are incorporated into products manufactured by Ericsson, Nokia, Motorola and Qualcomm. In the case of Qualcomm, SAWS is getting less business because QC can purchase similar components from Asian vendors at lower prices (due, i n part, to favorable currency translation). SAWS loss appears to be QC's gain. QC management specifically indicated that the company was not experiencing any slowdown in demand for the products that incorporate SAWS-type components...quite to the contrary, Dick Grannis indicated that Qualcomm is capacity constrained. Component vendors, from Spectrian to Powerwave to Sawtek, are always going to be at the mercy of their large customers. We all should be happy that Qualcomm diligently seeks to reduce its supply costs. Hope this helps, Gregg

To: w molloy who wrote (11417)	6/11/1998 10:29:00 PM
From: marginmike	Respond to of 152472

Malloy Since I know a little to much about sawtek let me give you my opinion. Sawtek is a parts supplier much as bose is to General Motors. They have Asian competition for parts they supply. These Asian companies have an improved price point, due to yen-Dollar exchange. fudementally Saws is not saying that CDMA growth is slowing, in fact it isnt, but that companies like Qcom have other sources now. Qcom is an assembler of handsets. Though they should lose business because of Asian slowdown, this is somewhat offset by parts(like Saws) now being cheaper. In reality, to my knowledge Qcom business hasnt been affected signifigently and they are running at full capacity. Furthermore the sellout of SAWS was overreaction. Saws has never missed a quarter yet. They are still strong for the 3rd quarter. They simply said the 4th quarter wasnt going to grow from the third. Even if other suppliers are present there is still a back log for CDMA SAWS components. This in fact is confirming the strength in the CDMA market. The other problem SAWS has to do with margins on GSM component(no affect to Q). In my humble opinion I feel that Motorolla's delays are partly responsible, as is infastructure buildout temporary lull. Either way considering earnings massacres, Saws was over done.