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Technology Stocks : The New QLogic (ANCR) -- Ignore unavailable to you. Want to Upgrade?

To: Huei-Sheng Kao who wrote (18629)	10/15/1998 3:08:00 PM
From: Kerry Lee	Read Replies (1) \| Respond to of 29386

As long as you are clear that the following is only my speculation and should not be taken as fact: The last I heard, they were leaning towards recognizing most of the $7 million licensing fee in the short term ..I don't know if the definition of short term is one quarter or 3 quarters. The software content of the ASICS is minimal, therefore it is my understanding that the $7 million is not determined by the new software revenue recognition standards . I believe that since the $2 million pre-paid royalties is for royalties on a future INRANGE product that ships in 2nd half 1999, then that $2 million won't be recognized until 2nd half '99. Any CPA's here, feel free to add your own opinions. Therefore, excluding Hucom/Netmarks revenue of $500K-1 Million ( I don't know if it falls in Q3 or Q4), I would speculate that Q3 revenues could be as low as $2.3 million OR as high as $7 million. IF it is the latter scenerio, at 90-100% gross margin for licensing, we are looking at actual operating profit in the $3-4 million range.