SAN FRANCISCO -- SCI Systems (SCI) - Get Report CEO Eugene Sapp didn't play hide and seek with the Banc of America Securities Investment Conference tech crowd. His company warned last week of soft third-quarter results, and on Thursday he stood right up to the question marks bobbing above the audience's heads.

"As the PC market softens, it's in our best interests to diversify our customers," Sapp said. "We have been working on this for a year."

Apparently, however, it has a little further to go to slither away from the PC smarminess, which contributed to its warning.

Sapp said the company has reduced its exposure to the wily, lower-margin PC business to 37% of its business from 65% a year ago. In that time, he's upped his more desirable telecom business to 25% from 13%. "As the PC growth rate settles out and prices go down, you'll continue to see a more favorable mix in products," he said.

Sapp would rather you forget about this nasty warning business, and look on the bright side. It's hired a new chief operating officer, chief information officer and supply chain senior vice president in the past year. It has almost 400 assembly lines and operations in 19 countries. And with $8.3 billion in fiscal 2000 sales, Sapp isn't backing off big positive predictions -- if in his own way. "I'm not going to stand up here and tell you we're going to be a $20 billion company in the next three years," he said with folksy Huntsville, Ala., delivery. "But we probably will be."

Companies such as

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are one reason this conference no longer carries the word "growth" in its title.

As CFO Mark McEachen described in perfect detail, the company is well poised to capitalize on broadband's emergence. It seems to think its 15% adoption rate in markets it entered more than two years ago is impressive and isn't embarrassed about its 4% to 5% adoption rate in metro areas where it's a newer entry. But Excite@Home's stock price has yet to jump on the cable car of earnings delight up to the


of boffo shareholder returns.

This week investors again saw why: company CEO George Bell took only a few months to follow ex-CEO Tom Jermoluk out the Excite@Home door. Bell has been through the mega-growth days with Excite and will stay on as chairman through 2001. But as McEachen put it, "the company has grown from 30 to 3,000 employees. It's too much for one person." Nevertheless, the cable-system-based Internet access provider has a job to do, and some growth to achieve. "Life doesn't stop. We're not putting our hands in our pockets," he said. "George is still fully engaged, and we're not changing any of our Street guidance."