View all newsletters
Receive our newsletter - data, insights and analysis delivered to you
  1. Technology
February 4, 1997updated 05 Sep 2016 1:01pm

CASCADE HIT BY FRAME RELAY SLOW DOWN, LOOKS TO ATM

By CBR Staff Writer

Cascade Communications Corp’s shares fell 36% in one day last week after investors became concerned about growth in its frame- relay switches. Concern about such a slowdown wiped $2.3bn from Cascade’s market value in one of the biggest technology-stock routs of the year. Cascade shares fell $23.125 to $41 in Nasdaq Stock Market trading after the Westford, Massachusetts, company released fourth-quarter results that slightly exceeded analyst estimates. Vowing in an interview that the company will never have to rely on one technology, one product, one customer again, Cascade chief executive Daniel Smith laid out plans for a broad diversification effort. Smith said Cascade is moving rapidly away from its earlier dependence on frame-relay products. In the year just ended, frame relays accounted for 75% of Cascade’s sales, down from about 95% just a year earlier, according to analysts’ estimates. Sales of frame-relay switches grew only about 7% from the previous quarter, down from growth rates of about 20% a year earlier. Inventory figures released by the company showed signs that Cascade rushed to fill orders at the end of the fourth quarter to meet expectations, a move that analysts believe will eat into sales in the current quarter. Cascade says its asynchronous transfer mode switching products should grow to between 25% and 30% of the company’s sales this year. Smith also expects growth from a software add-on known as IP Navigator, which lets Cascade switches connect directly to the Internet. Shipments of the product will begin during the next few months.

Content from our partners
Green for go: Transforming trade in the UK
Manufacturers are switching to personalised customer experience amid fierce competition
How many ends in end-to-end service orchestration?

Websites in our network
Select and enter your corporate email address Tech Monitor's research, insight and analysis examines the frontiers of digital transformation to help tech leaders navigate the future. Our Changelog newsletter delivers our best work to your inbox every week.
  • CIO
  • CTO
  • CISO
  • CSO
  • CFO
  • CDO
  • CEO
  • Architect Founder
  • MD
  • Director
  • Manager
  • Other
Visit our privacy policy for more information about our services, how New Statesman Media Group may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.
THANK YOU