Bay Networks Inc continues to look as if it is at best running to a standstill and at worst falling way behind its two key rivals in the networking industry, Cisco Systems Inc and 3Com Corp.
Bay’s fourth quarter and end of year figures show virtually flat revenues up 1.4% to $543m and 1.8% to $2.093bn respectively. Although Cisco is not due to report its end of year figures until early next month, 3Com Corp, which closed its year on May 31, reported quarter revenue up 25.7% at $829.9m and revenues for the year up 35.2% to $3.147bn. Cisco reported third quarter
sales up 52% to $1.648bn for the period that ended April 26. Bay executives have spent the last six months preparing the market for flat revenues despite the continuing growth of the networking market. Their warning look to have been heeded by the First Call analysts who saw their predicted earnings topped by the company. First Call had been expecting earnings per share of $0.12 for the quarter and $0.56 cents for the year from Bay before charges. Bay reported $0.15 cents and $0.59 cents respectively. Over the past 12 months Bay has taken steps to redress much of the managerial mess that was created by the initial merger that formed the company. The past year saw the company parting ways with president and CEO Andrew Ludwick while chairman Paul Severino also stepped down. David House was drafted in from PC chipmaker Intel Corp to unite the positions. Since then he has replaced much of the top level management as well as look to overlay his experience in the PC market as a model for the direction of the networking industry. In a rather downbeat statement accompanying the company’s results House said: The results demonstrate that we are beginning to make progress. During the past two quarters we have put in place a number of programs and processes throughout the company to improve our performance.