Here's How One Company Was Hurt by Y2K : LUSENET : TB2K spinoff uncensored : One Thread

This is an interesting story. Here's a company that stockpiled based on their assesment of Y2K and is now paying the price.


Standard Microsystems Y2K Stockpiling Hurt 4Q (03/03/00, 1:36 p.m. ET) Semiconductor Business News HAUPPAUGE, N.Y. -- The Y2K crisis that never materialized has affected the fourth quarter revenue for Standard Microsystems, which said Friday that its revenue would be off by as much as 25 percent.

The maker of PC I/O circuits, embedded controllers, and connectivy products stated that its revenue for the fourthquarter, ended Feb. 29, is expected to be between $31 million and $33 million, compared to $41 million for the quarter ended Nov. 30, 1999.

Normally, company revenue for the fourth quarter has been below the third quarter because of normal seasonal patterns in the PC industry, said Steven J. Bilodeau, chairman and CEO. But last year, OEMs stockpiled parts in anticipation of potential year 2000 date-rollover problems. Demand for parts has now been reduced as they worked down inventories.

"Our operating efficiency continues to improve and we are pleased that our gross margin percentage will remain strong in the quarter despite the temporary impact of Y2K on our revenues," said Bilodeau. "We believe that the Y2K inventory issues are now behind us. We look forward to continued operating strength that will fund the chip set development initiatives that will support long-term revenue growth."

SMSC said it expects to report between break-even and a modest profit for the quarter despite the revenue shortfall, reflecting continuing improvements in operating efficiencies.

NETsilicon, Waltham, Mass., experienced a similar drop-off due to Y2K orders. The provider of embedded networking semiconductors had one huge order that ballooned its third quarter revenue before returning to normal in the fourth quarter

-- Jim Cooke (, March 04, 2000



I think that you misunderstood the press release. Standard Microsystems didn't stockpile for Y2K, their customers bought heavily in the fiscal third quarter(ended Nov. 30, 1999) as THEY stockpiled for Y2K. Thus they bought less in fiscal fourth quarter(ended Feb. 29, 2000).

I don't think that this hurt Standard Microsystems at all, it just changed the timing of some of their sales that would have occurred in fiscal fourth quarter to fiscal third quarter.

-- J (Y2J@home.comm), March 04, 2000.


Duh! You're right. That's what happens when you read articles late at night. Thanks for catching that.

-- Jim Cooke (, March 04, 2000.

-- (hmm@hmm.hmm), September 17, 2000.

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