Nyquist Capital » WNTG

George Gilder - Telecosmic

Andrew Schmitt — Tue, 09 May 2006 15:14:03 +0000

The Wall Street Journal published a biographical article (free till May 10th) on George Gilder, one of the chief exhalers that inflated the optical bubble of 1999.

I mentioned Gilder last week in my first post on Wintegra (WNTG). He has consistently spoken positively of a network processor company called EZ-Chip and the holding company LanOptics Ltd. (LNOP). His support for the company has been unwavering for years as he continues to predict an NPU revenue ramp for EZ-Chip 6 months into the future. I hope this isn’t because EZ-Chip is a leading sponsor of his annual Telecosm shindig. How about some introspection into why things aren’t working out as he projected?

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Wintegra - Following up on a Comment

Andrew Schmitt — Mon, 08 May 2006 14:43:05 +0000

I received a good question on the Wintegra Inc. (WNTG) post I made last week. I felt the response was worth a post on it’s own. Please remember this is not investment advice, and not a negative outlook on Wintegra as a comapny, just my opinion of something that needs to be considered when attaching a multiple and valuation to the company. References to Teknovus and Passave are in context with the previous post.

From “Watcher” -

I don’t really understand your Cisco example: according to your example Cisco doubled its purchasing from Wintegra in 3 years (2003-2005): 27% of $4.5M in 2003 to 10% of $19.5M in 2005: can you explain this again (why doubling sales to Cisco is a problem)?

You ask a good question. In the interest of brevity I oversimplified my argument. Let me explain in detail.

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Wintegra - Good Company, High Valuation

Andrew Schmitt — Fri, 05 May 2006 12:28:25 +0000

Get ready to party like it’s 1999 - Wintegra, Inc. (WNTG), a network processor company, is going public. Prospectus here. Financial summary here.

Wait - the mob cries “This Time It’s Different” - Wintegra doesn’t make those ridiculously large 10G and 2.5G NPU’s that tech messiah George Gilder preached were the salvation of the coming optical revolution. (He still does, BTW - what is EZ-Chip paying this guy?). No, Wintegra’s NPUs are for the access network, Fiber to the home, DSL, i.e. the current pump-and-dump sector for Telecom.

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