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Jubak discusses the burn rate of various companies. Here is his opinion on Sycamore's.


<<You can see now why the size of the cash position on Sycamore Networks' balance sheet is important to investors. If the company had just, say, $200 million in the bank, I'd have to worry about the company running out of cash in less than a year. But with a balance of almost $1 billion to draw on, Sycamore Networks isn't in any danger of running out of cash even if business continues to falter and the burn rate climbs to $100 million a quarter. If I were an investor in Sycamore, I wouldn't lose sleep worrying about the company's financial survival. I could concentrate my concern on the company's troubled optical switch and the burn rate at its much less well-funded customers. Sycamore has enough cash and liquid investments in hand to cover even that higher rate of loss for another 10 quarters. I don't know anyone who thinks the current downturn in technology business will go on that long. Investors are likely to lose patience with such losses long before Sycamore runs out of cash to fund its business.>>

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