Niles used the term, "Disastrous," twice. The first time, during the beginning, was a general comment later made clear during his discussion of PC sales. The second, in the context of Digital which he sees having the same problems as IBM. Here's a brief summary of these two areas:
Niles said Gateway has little Y2K exposure since it sells to little guys rather than corporate America and will, "Sell a lot of boxes," during the Christmas season. CPQ and others (IBM, DELL) selling to corporate America will not do that good. IBM's PC sales to corporate America were up 50% during the second quarter, 11% for the 3rd quarter, and will be flat for the 4th quarter. CPQ's sales will be very similar.
Niles then says that CPQ has an additional problem: it bought Digital. We may see disastrous results because of Digital, not just PC sales. Digital makes a lot of million dollar, very expensive, systems--very similar to IBM.
Niles is next asked the question: Isn't that [i.e. doom and gloom over CPQ's earnings] already built into CPQ's price?
Niles: People were saying it was built in at 50, 40, 30, 20 and now its at 19. It is never really quite built in until the price of a stock hits zero.
"Obviously I think CPQ will be around for a while but there are a lot of problems."
So, that's a summary of Niles' usage of the term, "disastrous."
Maybe I'll feel a bit better if Atlanta wins tonight.
Lynn |
