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Bay sees record revenue

Bay Networks releases a first-quarter earnings report highlighted by record revenue, underscoring strong demand for its networking gear.

    Bay Networks' renaissance as a viable industry player continued unabated today. The company released a first-quarter earnings report highlighted by record revenue, underscoring strong demand for its networking gear.

    Given up for dead at this time last year, Bay Networks has gained new focus and momentum via CEO David House, who came over from Intel last fall to right the company's ship.

    The company announced earnings of $41.3 million, or 19 cents per share, compared with earnings of $5.6 million, or 3 cents, a year ago. The results include a $7.4 million research and development charge related to the company's acquisition of NetICs in December of 1996. Without the charge, the company would have reported $48.7 million for the quarter, or 22 cents a share.

    The earnings beat the consensus estimate compiled by First Call, which was 18 cents a share.

    Revenue for the quarter came in at a record $601.3 million, a 15 percent jump over the same period last fiscal year.

    Bay makes hubs, switches, and routers that interconnect desktops, servers, and networks. The company also has made a push recently into the remote access market, and rounds out its portfolio with a series of management software applications.

    "We are pleased with the 11 percent sequential quarterly revenue growth in a period which historically is seasonally weak," said House in a statement. "Our revenue results reflect a healthy demand for Bay Networks products around the world."

    The company announced in August of this year that its first-quarter revenues likely would exceed analyst expectations.

    Bay's stock closed the day down almost 3 percent, to 39 3/16, with nearly 3 million shares changing hands.