Does any one have any time frame when this may change.?
Here's XYLN's Q report, just out. Hoping it's indicative of strength in sector:
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Xylan Reports Record Third-Quarter Results
Business Wire - October 14, 1998 16:52
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CALABASAS, Calif.--(BUSINESS WIRE)--Oct. 14, 1998--Xylan Corp. (Nasdaq:XYLN), a leading provider of high-bandwidth switching systems, Wednesday reported its operating results for the three and nine months ended Sept. 30, 1998.
Revenue for the third quarter increased to $91.1 million, from $83.7 million in the second quarter of fiscal 1998, a sequential increase of 9 percent. As compared with the same quarter of the preceding year, revenues increased from $53.5 million, an increase of 70 percent. Revenue for the nine months ended Sept. 30, 1998, was $250.2 million, as compared with $146.6 million for the nine months ended Sept. 30, 1997, an increase of 71 percent.
Net income for the third quarter was $10.4 million, or 22 cents per share, compared with second-quarter net income of $9.6 million, or 20 cents per share. In the third quarter of 1997 the company reported net income of $4.6 million, or 10 cents per share.
Net income for the nine months ended Sept. 30, 1998, was $28.4 million, or 60 cents per share, as compared with $17.6 million, or 38 cents per share, for the comparable period one year ago. All per share amounts are computed on a diluted basis.
"We're delighted with our results in the September quarter," stated Steve Kim, chairman, president and chief executive officer of Xylan. "We achieved dramatic growth, once again outpacing our competitors. In particular, our VAR and direct business grew 25 percent, shifting to 68 percent of our overall business.
"We have started initial shipments of our new OmniS/R Gigabit switch, in combination with X-Cell ATM switching and OmniStack low-end products. As a result, we feel confident that we can continue strong growth in the December quarter and beyond."
As of Sept. 30, 1998, the company's cash, cash equivalents, and short- and long-term investments equaled $123 million, and shareholders' equity equaled $212 million. The company bought back approximately 1.5 million shares of its common stock during the third quarter ended Sept. 30, 1998. For the nine months ended Sept. 30, 1998, the company has repurchased approximately 2.2 million shares.
Xylan will make the text of its quarterly conference call available for a short time on its Web site at www.xylan.com/q3call/, starting at 3 p.m. PDT.
About Xylan
Xylan is one of the leading switching companies in the world; its products combine LAN switching, ATM switching, layer-three switching and wide-area switching, over a wide range of interfaces and media. Xylan's switches are distinguished by advanced architectures and chip designs, and by any-to-any switching.
The same XOS software powers a full range of Xylan switches, from small workgroup Ethernet switches to large multilayer backbone switches. As a result, a Xylan network is able to deliver cohesive services, in both end-user and service-provider networks.
Xylan's Switched Network Services initiative takes switching to the next step: a comprehensive set of services, including DHCP, network address translation, LDAP, RADIUS, DNS, multicast switching and routing, RSVP, wide-area compression, broadcast management, policy-based configuration, and multilayer accounting. Many of these services are already shipping.
Additional information about Xylan and its products can be found at www.xylan.com.
Except for historical information contained herein, the matters discussed in this news release may contain forward-looking statements involving risks and uncertainties that may cause actual results to differ materially. Among the factors that could cause results to differ are uncertain market acceptance of the company's products, general economic conditions, overall demand levels for networking solution products, the timely development of new products and intense competition in the networking industry. Readers are referred to the documents filed by Xylan with the Securities and Exchange Commission, including the company's most recent reports on Form 10K and 10Q, which identify important risk factors related to the company's business that could cause actual results to materially differ from those contained in the forward-looking statements.
XYLAN CORP. AND SUBSIDIARIES
CONSOLIDATED CONDENSED INCOME STATEMENTS
(in thousands, except per share data)
(unaudited)
Three Months Ended
Sept. 30, June 30, Sept. 30,
1998 1998 1997
Revenue $ 91,133 $ 83,678 $ 53,517
Cost of revenue 39,425 36,128 23,718
Gross profit 51,708 47,550 29,799
Operating expenses:
Research and development 10,849 9,886 6,778
Sales and marketing 23,784 21,769 15,688
General and administrative 2,443 2,295 1,791
Total operating expenses 37,076 33,950 24,257
Operating income 14,632 13,600 5,542
Interest income, net 1,190 1,363 1,550
Income before income taxes 15,822 14,963 7,092
Income tax expense (benefit)/a 5,384 5,360 2,485
Net income $ 10,438 $ 9,603 $ 4,607
Net income per share:
Basic $ 0.24 $ 0.22 $ 0.11
Diluted $ 0.22 $ 0.20 $ 0.10
Shares used in per share calculation:
Basic 42,921 43,159 42,647
Diluted 46,956 48,246 47,269
Nine Months Ended
Sept. 30, Sept. 30,
1998 1997
Revenue $250,181 $146,647
Cost of revenue 108,205 64,636
Gross profit 141,976 82,011
Operating expenses:
Research and development 29,522 18,363
Sales and marketing 65,661 42,234
General and administrative 6,975 4,969
Total operating expenses 102,158 65,566
Operating income 39,818 16,445
Interest income, net 4,044 5,190
Income before income taxes 43,862 21,635
Income tax expense (benefit)/a 15,436 4,070
Net income $ 28,426 $ 17,565
Net Income Per Share:
Basic $ 0.66 $ 0.41
Diluted $ 0.60 $ 0.38
Shares used in per share calculation:
Basic 43,063 42,398
Diluted 47,593 46,822
a: Income tax expense (benefit) for the nine months ended Sept. 30,
1997, includes a one-time income tax benefit of $4 million, or 10
cents on basic net income per share and 8 cents on diluted net
income per share.
XYLAN CORP. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(in thousands)
Sept. 30, Dec. 31,
1998 1997
(unaudited)
Assets
Current assets:
Cash, cash equivalents and short-term
investments $ 45,429 $ 79,088
Accounts receivable, net 61,351 53,013
Inventories, net 23,833 17,731
Deferred income taxes, net 8,600 6,100
Prepaid expenses and other current assets 3,930 2,892
Total current assets 143,143 158,824
Investments 77,299 59,382
Note receivable 7,500 7,500
Property and equipment, net 27,279 20,894
Other assets 5,556 4,306
Total assets $260,777 $250,906
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable and accrued expenses $ 33,620 $ 26,382
Deferred revenue 9,676 4,317
Other current liabilities 2,426 3,191
Total current liabilities 45,722 33,890
Deferred revenue 2,757 899
Other liabilities -- 17
Total liabilities 48,479 34,806
Shareholders' equity:
Common stock and additional paid-in capital 158,546 190,774
Retained earnings 53,752 25,326
Total shareholders' equity 212,298 216,100
Total liabilities and shareholders'
equity $260,777 $250,906
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