3com.com
That's fast !
3Com® Reports Second Quarter
Of Fiscal 1999 Results
Sales Increase 29% from Same Quarter of Prior Year
Consolidated Statements
SANTA CLARA, Calif., December 22, 1998 – 3Com
Corporation (Nasdaq: COMS), a leading global
networking company, today reported financial results for its second fiscal quarter
ended November 27, 1998. Sales of $1.541 billion increased ten percent
sequentially and 29 percent from $1.197 billion reported in the year ago quarter.
Net income for the current quarter was $132.9 million, or $0.36 per share,
compared to net income of $93.7 million, or $0.26 per share reported in the
previous quarter, and net income of $4.0 million, or $0.01 per share reported in
the year-ago quarter. Excluding a $0.6 million net charge related to merger and
real estate activities, pro forma net income was $133.4 million, or $0.36 per share
for the current quarter, an increase of 54 percent from the previous quarter.
Excluding a net credit of $10.2 million related to past merger activities, net income
in the previous quarter was $86.7 million, or $0.24 per share.
For the second fiscal quarter, sales of Systems products totaled $744.7 million, an
increase of nine percent from the previous quarter and 25 percent year-over-year.
Client Access product sales of $795.8 million increased ten percent sequentially
and 33 percent from the year-ago quarter.
"Second quarter results were driven primarily by sustained favorable market
conditions across the networking industry and continuous improvements in our
operational management, both from an income statement and balance sheet
perspective. New product momentum and seasonal strength also contributed
positively to the quarter," said Eric Benhamou, 3Com chairman and CEO.
"Additionally, 3Com's unique position in the networking industry as the leader in
connecting people with information is enabling us to assert leadership in such
emerging markets as Internet and LAN telephony, storage area networking
(SAN), and home networking that will drive our growth into the millennium."
During the quarter, 3Com made several announcements that highlight the
company's ability to deliver converged voice and data solutions today, as well as in
the future. The acquisition of EuPhonics, Inc., a leading developer of DSP-based
audio software that drives integrated circuits, sound cards, consumer electronics
and other hardware, will enable 3Com to create a new category of products that
merges desktop and mobile modems and NICs with sound capabilities. 3Com
also announced a new carrier-class IP telephony system based on a three-tier
architecture of gateways, gatekeepers, and back-end servers that offer service
providers a reliable and scalable solution with a high degree of system resiliency,
essential for both incumbent and emerging carriers. Additionally, 3Com outlined
the industry's first comprehensive strategy for building High Availability Networks
that meet the same "four-9s availability" required by voice networks and that
enable customers to run critical applications such as E (electronic) commerce and
Voice-over-IP.
Also in the second quarter, 3Com formed strategic PC OEM relationships with
IBM, Hewlett-Packard and Toshiba America. These major PC OEMs become
partners in the 3Com Connected™ program and will pre-install 3Com NICs,
modems, and/or PC Cards into their PCs. 3Com also expanded its relationship
with Dell Computer to include broadband connections, including both its
DOCSYS compliant cable modems and its DSL modems.
In December, 3Com once again redefined the handheld computing industry with
the introduction of the Palm VII handheld computer, a revolutionary new product
that gives customers fast access to personal, business and Internet information.
With the Palm VII organizer, 3Com also introduced "web clipping," a means of
extracting only a specific set of needed information from a given web site.
Twenty-two initial content partners including ABCNews.com, ESPN.com,
E*TRADE, MasterCard, Visa, The Wall Street Journal Interactive and Yahoo,
have made their web content available for web clipping. Also in December, 3Com
and Siemens AG announced plans to form a joint venture to develop a rich set of
LAN telephony and multimedia products including communications servers and
digital phones, LAN telephony gateways, and call processing software for
enterprise customers.
About 3Com Corporation
With more than 200 million customers worldwide, 3Com Corporation connects
more people to information in more ways than any other networking company.
3Com delivers innovative information access products and network system
solutions to large, medium and small enterprises; carriers and network service
providers; PC OEMs; and consumers. 3Com - More connected.™ For further
information, visit 3Com's World Wide Web site at www.3com.com or the press
site at www.3com.com/pressbox. |
