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Technology Stocks : Lam Research (LRCX, NASDAQ): To the Insiders -- Ignore unavailable to you. Want to Upgrade?

To: FLSTF97 who wrote (2810)	5/3/1999 2:28:00 PM
From: Duker	Read Replies (1) \| Respond to of 5867

70% GM on Teres? Yeah. It is probably easy to have 70% GMs when you haven't actually sold a unit yet! I think that it would be safer to assume a number in the 60's ... low or high sixties depends on the pricing environment ... but, as I understand it, the product is designed to have GMs in the 70s ... Whether TERES carries with it a 60% GM or a 70% GM is a bit like splitting hairs given that the real leverage comes from actually selling these things! [N.B., I AM NOT SAYING THAT 1.6% IN BLENDED GROSS MARGINS IS MEANINGLESS ... I AM JUST ARGUING THAT IT IS MORE IMPORTANT TO ACTUALLY GENERATE REVENUE FROM THE PRODUCT FIRST ... to that end, expect a lower gross margin as the company prices it aggressively during the early adoption phase ...] The rumor I heard is that the one in Japan got sent back. As I understand it, there is a rolling 5 system evaluation group ... there have been about 20 customers who have demoed it and that getting units "sent back" is a normal part of the procedure as LRCX only has 5 units in the field. Now if a TERES got sent back with a "hated-it" sticker on it ... that would be incremental (bad) news ... but, I have not heard that this is the case. --Duker