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Technology Stocks : Zitel-ZITL What's Happening -- Ignore unavailable to you. Want to Upgrade?

To: CalculatedRisk who wrote (16784)	7/23/1998 1:21:00 PM
From: SOROS	Respond to of 18263

The solution services business unit was formed in the first quarter of the previous fiscal year. As of June 30, 1998 this business unit had not realized significant revenue. I remain, SOROS

To: CalculatedRisk who wrote (16784)	7/23/1998 7:38:00 PM
From: CalculatedRisk	Read Replies (5) \| Respond to of 18263

PREDICT THE RESULTS CONTEST! Entries so far: $1.2 Million Graeme Smith $500 Norma <$793,846.23> TEDennis <$2 Million> N.Y Long <$3.2 Million> Pete Mason <$3.8 Million> Greg M. <$3.92 Million> White Shoes <$4.0 Million> Alex M. <$4.1 Million> Timoteo <$4.125 Million> Gordon A. Langston <$4.3 Million> CalculatedRisk <$4.4 Million> Bill Wexler <$4.5 Million> Ken Holbert, Jr. <$4.6 Million> Dave Mansfield <$4.7 Million> Mark the K <$4.83 Million> Bob Trocchi <$4.941 Million> NYBellBoy <$4.966 Million> Craig Crawford <$5.1 Million> Corey Haber <$5.2 Million> Daniel Chisholm <$5.35 Million> Russian Bear <$5.5 Million> Michael <$5.95 Million> McNabb Brothers <$6.15 Million> Wing Chan <$6.66 Million> SOROS <$6.9 Million> frank 3 <$7.25 Million> Marconi <$7.77 Million> Barbara Payne Previous winners in bold. New entries welcome. Regards, Bill

To: CalculatedRisk who wrote (16784)	7/23/1998 8:01:00 PM
From: CalculatedRisk	Read Replies (1) \| Respond to of 18263

Hints on winning: 1) ZIT usually underperforms even the worst of expectations. I always estimate their losses and then add some more. I call this the ZIT management penalty ... or the JKing! NOTE: This quarter, I doubt ZIT will underperform Barbara's estimate of a loss of $7.77M! 2) Last quarter the ZIT lost $5.49M, without any one time charges! From some respects, this quarter will be worse. Bad news this quarter: a) Y2K Solution Services got blanked again (OK ... nothing new). b) Storage is being divested (shhh .... divested is a code word for shut down). Sales have probably dropped significantly. c) Inventories were at $1.9M, mostly for storage. Expect a write down in this area. d) Debentures were issued with a 10% discount. ZIT needs to write off $1M over this quarter and next. e) In March, ZIT signed a new 5 year lease on their Fremont building at a substantial increase ... for $990K per year. Three months later, ZIT is now trying to cancel their lease. See above: JKing or Management Penalty!** Good News this quarter (for the bottom line): a) ZIT has reduced their workforce from 246 at the beginning of the year to 161 employees as of June 30th. This should reduce expenses by approximately $1 to $1.5M this quarter. b) ZIT received their final royalty payment from IBM this quarter for $740K. In the end, it is probably best to just guess! Regards to All, Bill