Digital Drives S-As 3rd-Quarter Growth

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Atlanta-Digital-subscriber growth drove fiscal third-quarter revenue increases at set-top-box manufacturer Scientific-Atlanta Inc.

S-A reported a revenue increase of 38 percent to $440.7 million and net earnings of $38.1 million, or 24 cents per share, up 83 percent from $20.8 million (13 cents) last year.

For the nine-month period, revenue rose 31 percent to $1.2 billion and earnings climbed 76 percent to $96.7 million, or 61 cents per share.

Broadband sales drove most of the growth, with transmission sales up 47 percent year-over-year to $182.8 million and subscriber sales up 45 percent to $212.9 million.

During the period, more than 1 million orders were placed for S-A's "Explorer" digital interactive set-tops and 512,000 units were shipped, versus 267,000 units in its fiscal second quarter.

S-A also shipped 18 commercial digital-interactive headends in the period, for a total of 140 shipped to date. As of March 31, more than 1.3 million Explorer set-tops had been deployed in consumers' homes.

S-A began shipping the "Explorer 3000" interactive set-top in its fiscal third quarter, and it plans to begin shipping its more advanced "Explorer 6000" model-which adds a Data Over Cable Service Interface Specification modem, a second application processor, additional memory and an optional disk drive-this summer.

"Our financial performance reflects substantial strength across virtually all of our businesses," CEO James McDonald said in a prepared statement. "The markets we participate in are very healthy, and our focus on the execution of our strategy is producing excellent results. We're particularly excited by the sharp increase in demand for our Explorer platform."

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