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Technology Stocks : i2 Technologies -- Ignore unavailable to you. Want to Upgrade?

To: D. K. G. who wrote (818)	10/23/1998 3:48:00 PM
From: Shane M	Read Replies (1) \| Respond to of 2339

My thoughts on CC: Overall liked what I heard, but not uniformly positive. Liked the prospects of bringing in high quality sales force from many of ERP vendors. Business w/ many of the ERP vendors is slowing, so maybe they're seeing the opportunity at a co like ITWO. As someone else mentioned, "the number of feet on the street" is the primary constraint the company is facing now. They could sell more if only they had more people out there. The comment about reduced competition was extremely surprising and I'm still not sure I heard it right. Manugistics seems to be a non-issue now. Sidhu took a very strong stance against SAP, taking every opportunity the Q & A allowed to denounce their efforts as little more than rhetoric at this point. It was somewhat humorous to hear Sidhu be semi-combative. Were very confident in the quality of the Pipeline. Very different comments vs. last quarter. I was concerned about the rev projection of $500 million, and particularly Sanjiv's mention of 10% margins. I got the feeling that that was something Dave Carey (CFO) was wishing hadn't been mentioned. It was clear that the budgeting had not yet been worked out and shouldn't have been discussed at this point. Or maybe they were just throwing that out to lower expectations. Who knows? I can live with the lower margins for now, especially given the comments about opportunity to expand business through R&D spending, but I would really like to see top line growth remain strong, and would've preffered them not lowering revenue projections for '99. Their comments about stong pipeline, good hiring environment for salesmen, not losing employees, lower competition, etc certainly didn't suggest a slowdown of any kind, and international was expected to begin contributing more to the growth. These things don't jive IMO. Dave Carey was a little cagey concerning revenue recognition, and I was hoping he'd elaborate more on this. It sounded like he was saying i2 was taking a more conservative approach to revenue recognition than many in the industry, but he wouldn't say how much revenue was normally deferred. One analyst asked "could you have done more if you needed to?" and Carey responded "I don't know how I should answer that." and didn't say any more. I think he was implying "yes, we could've, but that's not the way we've decided to account for revs." Did others have a similar interpretation? Big 6 support gaining momentum. Implementors seems to be keeping pace and should be able to grow with the business. It didn't seem to be as big a concern/constraint as in the prior CC. Deal with IMIC was discussed. One more step toward providing an end-to-end solution. Especially good for doing ERP/SCM combined deals where only basic ERP is needed. Speeds up process quite a bit from what I could tell. ORCL relationship not paying off much yet, but Sanjiv said it is still early. They seemed somewhat surprised at the strong results of their initial foray into the middle market. It's still early, but it seemed this was going over in a big way. Price competition still not much of an issue. Overall, very positive, but with the typical stray comments interspersed to cause a little bit of caution on the part of investors and analysts. Shane