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The steep drop in price after the quarterly conference call is a direct result of the company's decision to try to report on both adjusted GAAP basis and an invoiced shipments basis. The CFO went to great length to make it clear that guidance was being provided on an "invoiced shipments" basis but the conference call format barely supports concise communication of one basis much less two different approaches with wildly different results. The selling started in after hours trading within seconds of the CFO's statement that Q2 2008 would produce 98 Million in revenue and 1 to 2 Million in earnings ($0.01 to $0.02 per share) I was listening and I am very aware of the two approaches from prior company financial reports (the 2007 annual report forecasts the impact by quarter for 208 very nicely) and I was confused.

At the end of the day, it will all work out. The company has already realized the error in it's approach to Q1 results and decided to stick to adjusted GAAP going forward. In fact, management compensation plans have been modified to set rewards based on adjusted GAAP so everyone is clearly aligned (see recent SEC filing). No doubt the audience will be shocked when Q2 comes in well above $0.01 per share. No doubt the stock will reflect the increased buying interest very quickly. This company will likely exceed $500 million in revenue this year and earn over $120 million in profit. Some of it this is deferred from 2007 and some if it is just a continuation of their blistering growth. I don't know where it stops but it is a new technology with breakthrough economics for buyers and it will certainly become ubiquitous in the longer run so hop on board and enjoy the ride because this one is going to be special.
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