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Technology Stocks : Ascend Communications (ASND) -- Ignore unavailable to you. Want to Upgrade?

To: Jack Colton who wrote (59368)	1/20/1999 12:17:00 AM
From: A. Edwards	Respond to of 61433

Jan 19 (Reuters) - Ascend Communications Inc. on Tuesday said one-time charges led to a $197 million loss in the fourth quarter, but the computer networking company posted operating profits in line with Wall Street expectations. That compared with a profit of $47.6 million, or 24 cents a share, in the fourth quarter of 1997, Ascend said. Excluding charges, Ascend reported pro forma net income of $69.8 million, or 31 cents a share, matching the Wall Street consensus as compiled by First Call. Sales rose to $476 million from $292.5 million. "We're very excited about our opportunity in the first quarter and were very pleased with the performance in the quarter," Mory Ejabat, Ascend's chairman, told Reuters in an interview. Revenue from Stratus Computer was better than expected, at $58 million, Ascend said. Late last year, Ascend bought Stratus with an eye on its computers and software that control key functions at the heart of much of the national phone network. Revenue in North America rose 33.5 percent in the fourth quarter from the third, paced by strong sales of networking gear to smaller companies now offering local and long-distance phone service and seeking to challenge established companies such as AT&T Corp. Revenue outside the United States rose 17 percent sequentially. Overall, 73 percent of Ascend's revenue came from the United States, while 27 percent was generated outside the country. The company also said it had a gross margin -- percentage of revenue minus product costs -- of 61.4 percent in the fourth quarter. That figure should improve to 62 percent in the first quarter. Ascend executives also reiterated earlier estimates that it would generate 1999 revenue of $2.3 billion and diluted earnings per share of $1.70. It also said it was comfortable with earlier guidance for first-quarter revenue of $490 million and earnings of about 36 cents per share. "The competitive landscape hasn't really changed; we are still ahead of the pack in many areas and will only get stronger once the Lucent transaction is completed," Ejabat said in the interview.