H2 FY 1997 looks to be favorable in these regards. Quantum believes that the Fireball TM is the first desktop 3.8 GB drive available. For now, the strategy is to use captive head production in the high-end drives where they hope volume is best and operating margin leverage is greatest. Fully-diluted EPS includes the effect of conversion of notes. Some voluntary conversions did take place when the stock was in the 20s.
European demand is still unpredictable.
The company expects that their current product cycle will be strong enough that operational cash flow will strengthen and create a stronger balance sheet than they currently have. The company's past charge for restructuring is being worked down, as is the level of Atlas 1 inventory. Future cash flow needs are becoming more clear as these happen and as the company moves up the learning curve on their key strategies. A Fool conference call synopsis represents an effort to highlight the salient points of a conference call and should not be taken as an authoritative accounting or transcription of the entire event. Copyright 1996, The Motley Fool All Rights Reserved.