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Technology Stocks : copper mountain CMTN -- Ignore unavailable to you. Want to Upgrade?

To: SunSunM who wrote (29)	5/14/1999 11:07:00 AM
From: William F. Wager, Jr.	Read Replies (1) \| Respond to of 1226

From today's Wall St. Journal IE---> Joseph Markee and Mark Handzel named their Internet-equipment startup Copper Mountain Networks Inc. in 1996 because of the huge opportunity they saw in the nation's network of copper phone lines. Yesterday, Copper Mountain scaled impressive heights of its own, reaching a market value of more than $1.5 billion as its shares more than tripled on their first day of trading. On paper, Messrs. Markee and Handzel are now worth more than $50 million apiece. Copper Mountain, Palo Alto, Calif., sold four million shares at $21 each, up from the $12 to $14 offering price the company indicated in April. In Nasdaq Stock Market trading, the shares soared as high as $72.375, before closing at $68.4375, up $47.4375 from the offering price. Copper Mountain makes equipment for high-speed Internet connections through digital-subscriber lines. Its biggest customers are two DSL service providers, NorthPoint Communications Group Inc. and Rhythms NetConnections Inc., which have had high-flying IPOs of their own in recent weeks. All three companies are focusing on marketing DSL, which allows users to connect to the Internet at speeds up to 27 times faster than conventional modems, to small businesses, branch offices and telecommuters, rather than to consumers. Unusual for an Internet-related IPO, Copper Mountain is approaching profitability. The company reported a loss of $1 million in the quarter ended March 31, on revenue of $13.2 million, after reporting a loss of $10.3 million on revenue of $21.8 million for 1998. Still, Copper Mountain has lost $24.6 million since its founding and warned potential investors in filings with the Securities and Exchange Commission that its losses could continue. Revenue actually declined in the first quarter, compared with the fourth quarter of 1998, because NorthPoint reduced purchases, the company said. Copper Mountain faces other challenges, including competition from Cisco Systems Inc., Ascend Communications Inc. and Alcatel SA, among others. Moreover, Ascend has agreed to be acquired by Lucent Technologies Inc., which could imperil Copper Mountain's deal to make equipment under Lucent's name. A Lucent spokeswoman declined to comment yesterday on how the Ascend acquisition would affect Copper Mountain, although Lucent and Copper Mountain have announced several additional marketing deals in recent weeks. In a December interview, Copper Mountain Chief Executive Rick Gilbert said that by the end of this year, the company would have to be "aligned with or even acquired by a larger company." Yesterday, Mr. Gilbert said Copper Mountain considers itself aligned with Lucent and will seek to grow independently. "The success of this offering is a validation of our products and strategy," he said. He declined to comment on the Ascend acquisition. After yesterday's offering, roughly half of Copper Mountain's stock is held by six venture-capital firms. Intel Corp. owns 4.2%. --Bill