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

To: jach who wrote (2817)	10/15/1998 9:55:00 AM
From: jas cooper	Read Replies (2) \| Respond to of 4135

Would you be Tim's mentor or protege?

To: jach who wrote (2817)	10/15/1998 11:33:00 AM
From: pat mudge	Read Replies (1) \| Respond to of 4135

Bloomberg interview with Doug Hill, VP Marketing A hedge fund friend just phoned and played back the interview. All errors mine: Q: You managed growth rate in spite of ALA and IMB. How? A: Two major success stories here: 1) DIR/VAR --- they're intertwined. This was the fruition of a lot of work. Closing some big sales, and 2) Growth in NA. Q: Pricing --- gross margins were flat, yet smaller switches doubled. . . A: The fundamental driver in the industry is chips. In 1993 a single ethernet port cost between $1500 and 2000. In 1994 we built capability of doing our own chips. We cut in half models of 10/100. Same in OmniStac modules. Q: What about Dec. Q compared to Q3? A: Two trends: 1) short term there was too much inventory and 2) seasonally slow quarter for Alcatel. Next 5 Qs we expect slightly increamental dollar volumes, but percentage will shrink. We're building DIR/VAR. Q: Inventory situation? A: Success in the quarter. IBM from 6 to 7 weeks down to 5; ALA from 5 to 6 weeks down to 4. Our own inventory turns went down, too. [I know this is repetitious. But, saving the best for last. . .] Q: Top line was 70% year to year. What can we expect going forward? A: Q4 on through 1999 expect pace of growth faster than industry. We compare outselves to switching and will outgrow that sector. Dell'Oro estimates 24% revenue growth. We can do better. Q: Share repurchase, are you continuing? A: We may continue to repurchase. have to be careful any shares are targetted to employee stock compensation program. We don't want problem with pooling of interest should someone want to acquire or we acquire. Q: You're an independent company. Can you maintain that? A: Xylan is fortunate. . . we're well positioned. . . world class data, channel, sales, customer base, revenue growth. . . we will continue to fully capitalize on our position of strength internally or in strategic combinations. He might have listed partnering in there, too, but I was so distracted by his use of "strategic combinations," I didn't get what came before it written down. That's it for now. Pat