Delaware		04-2958132
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)
1075 First Avenue, King of Prussia, PA		19406
(Address of principal executive offices)		(Zip Code)

Common Stock, $.01 par value		38,672,830
(Title of each class)		(Number of Shares)

		Page
PART I—FINANCIAL INFORMATION
Item 1.    Financial Statements:
Condensed Consolidated Balance Sheets as of December 29, 2001 and September 28, 2002 (Unaudited)		1
Condensed Consolidated Statements of Operations for the three- and nine-month periods ended September 29, 2001 and September 28, 2002 (Unaudited)		2
Condensed Consolidated Statements of Cash Flows for the three- and nine-month periods ended September 29, 2001 and September 28, 2002 (Unaudited)		3
Notes to Unaudited Condensed Consolidated Financial Statements		4
Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations		15
Item 3.    Quantitative and Qualitative Disclosures About Market Risk		34
Item 4.    Controls and Procedures		34
PART II—OTHER INFORMATION
Item 1.    Legal Proceedings		35
Item 2.    Changes in Securities and Use of Proceeds		35
Item 3.    Defaults Upon Senior Securities		35
Item 4.    Submission of Matters to a Vote of Security Holders		35
Item 5.    Other Information		35
Item 6.    Exhibits and Reports on Form 8-K		35
SIGNATURES		36

		December 29, 2001				September 28, 2002
ASSETS
Current assets:
Cash and cash equivalents		$	105,896			$	45,651
Short-term investments			842				2,275
Marketable securities			—				10,022
Accounts receivable, net of allowance of $239 and $662, respectively			6,973				5,552
Inventory			17,779				32,424
Prepaid expenses and other current assets			1,502				4,114
Total current assets			132,992				100,038
Property and equipment, net			28,929				49,192
Goodwill, net			13,453				19,952
Other assets, net of accumulated amortization of $377 and $1,039, respectively			15,391				17,497
Total assets		$	190,765			$	186,679
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	22,356			$	20,530
Accrued expenses and other			8,196				9,582
Deferred revenue			8,193				15,991
Current portion—note payable			39				41
Current portion—capital lease obligations			506				218
Total current liabilities			39,290				46,362
Note payable			5,208				5,172
Commitments and contingencies
Stockholders’ equity:
Preferred stock, Series A, $0.01 par value, 5,000,000 shares authorized; 400 and 0 shares issued as mandatorily redeemable preferred stock and outstanding, as of December 29, 2001 and September 28, 2002, respectively			—				—
Common stock, $0.01 par value, 90,000,000 shares authorized; 37,673,808 and 38,793,480 shares issued as of December 29, 2001 and September 28, 2002, respectively; 37,672,598 and 38,732,270 shares outstanding as of December 29, 2001 and September 28, 2002, respectively			377				388
Additional paid in capital			277,628				285,437
Accumulated other comprehensive income			—				96
Accumulated deficit			(131,738	)			(150,775	)
			146,267				135,146
Less: Treasury stock, at par			—				1
Total stockholders’ equity			146,267				135,145
Total liabilities and stockholders’ equity		$	190,765			$	186,679

		Three Months Ended								Nine Months Ended
		September 29, 2001				September 28, 2002				September 29, 2001				September 28, 2002
Revenues:
Net revenues from product sales		$	17,140			$	27,778			$	50,158			$	85,721
Service fee revenue			911				4,545				1,061				11,596
Net revenues			18,051				32,323				51,219				97,317
Cost of revenues from product sales			11,900				20,257				34,746				61,011
Gross profit			6,151				12,066				16,473				36,306
Operating expenses:
Sales and marketing, exclusive of $90, $154, $184 and $155 reported below as stock-based compensation, respectively			7,364				11,362				21,598				30,297
Product development, exclusive of $386, $0, $386 and $(44) reported below as stock-based compensation, respectively			2,259				3,317				6,713				8,720
General and administrative, exclusive of $7,121, $27, $8,397 and $(148) reported below as stock-based compensation, respectively			2,388				3,708				7,505				10,757
Stock-based compensation			7,597				181				8,967				(37	)
Depreciation and amortization			1,792				2,585				4,962				6,692
Total operating expenses			21,400				21,153				49,745				56,429
Other (income) expense:
Other income			(100	)			—				(400	)			—
Gain on sale of assets			—				(379	)			—				(379	)
Interest expense			140				127				470				389
Interest income			(648	)			(270	)			(2,487	)			(1,096	)
Total other (income) expense			(608	)			(522	)			(2,417	)			(1,086	)
Net loss		$	(14,641	)		$	(8,565	)		$	(30,855	)		$	(19,037	)
Losses per share—basic and diluted:
Net loss		$	(0.42	)		$	(0.22	)		$	(0.94	)		$	(0.49	)
Weighted average shares outstanding—basic and diluted			34,747				38,769				32,892				38,497

		Nine Months Ended
		September 29, 2001				September 28, 2002
Cash Flows from Operating Activities:
Net loss		$	(30,855	)		$	(19,037	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization			4,962				6,692
Stock-based compensation			8,967				(37	)
Gain on sale of assets			—				(379	)
Changes in operating assets and liabilities:
Accounts receivable, net			(364	)			2,812
Inventory			1,622				(2,732	)
Prepaid expenses and other current assets			(444	)			(2,058	)
Accounts payable and accrued expenses and other			(17,361	)			(8,959	)
Deferred revenue			4,101				7,287