Hi,
I heard Steve Fortuna [not sure of spelling ] this am on Squawk Box. He did NOT do his home work. HE said that GTW preannounced that they would not meet expectations because of the Y2K problem. That in itself is a LIE. GTW said it was because of the CHIP shortage and that it was only a GWT problem. This had NOTHING to do with DELL.
I don't understand why the SEC doesn't go after people like Steve and/or Dan Niles for SPECULATING and hurting small investors by scaring them into selling.
I have learned, when you have a GOOD company like DELL, you should NOT be afraid. DELL will come out shining.
I will be a buyer today of MORE DELL.
DorineFOCUS-Gateway shares slip after profit warning
(Updates stock price, adds Intel background)
By Duncan Martell
PALO ALTO, Calif., Jan 6 (Reuters) - The shares of Gateway Inc. (NYSE: GTW), the No. 2 direct seller of personal computers, slipped on Thursday after warning that sales and earnings for the fourth quarter will fall below analysts' expectations.
The company late on Wednesday cited "spotty and unreliable" supplies of microprocessors and motherboards, the brains and guts of PCs, respectively, as well as slumping demand from business customers because of the Y2K date change.
Intel Corp. (NASDAQ: INTC), the world biggest computer-chipmaker, is San Diego-based Gateway's sole supplier for microprocessors and many analysts on Thursday issued notes to clients in which they all but guaranteed an announcement by Gateway soon that it would start buying chips from Intel's rival Advanced Micro Devices Inc. (NYSE: AMD).
In New York Stock Exchange trading, Gateway shares fell 2-9/16 to 59-11/16, after touching 58-1/2. Investors hammered the stock in after-hours trading on Wednesday.
"Supply of key processors and motherboards was severely constrained, spotty and unreliable, particularly in our consumer sweet-spot in the $999 to $1,299 price range," said John Todd, chief financial officer, in a statement. "We're in the process of fixing that issue now and will have news on that front in the very near future."
Intel's Pentium III microprocessors running at 450 megahertz are the ones Gateway uses in PCs sold in the "sweetspot" range of the consumer market. Gateway also cited a $100 million to $150 million shortfall to Y2K-related slowing in their government, education and big business accounts, which make up about 27 percent of overall sales, according to Salomon Smith Barney analyst Richard Gardner in a note to clients.
"We see it as a one-time thing, as an industry or environment issue rather than a Gateway issue," Gateway Chief Financial Officer John Todd said in an interview on Wednesday.
Intel had said earlier in the fourth quarter that it expected demand to be strong in that quarter, which is the PC industry's strongest. It said demand was strong for many of its products, including its Pentium III and Celeron processors, as well as chipsets.
As the quarter progressed, Intel officials said they were meeting customer demand. But that statement did not include additional, or "upside," requests from PC makers for additional Intel components.
An Intel official declined comment on Thursday, citing the company's quiet period ahead of its quarterly earnings report, which is due out Jan. 13.
Gateway said it expected to report revenues of about $2.45 billion for the fourth quarter, a 6 percent increase over the same period the previous year.
It expects to report fourth-quarter earnings per share of about 37 cents after adjusting for a previously announced charge related to its alliance with America Online Inc. (NYSE: AOL), which it said was 7 cents a share below the current analysts' consensus.
Gateway also said it remained comfortable with analyst forecasts for earnings of 41 cents per share for the first quarter and $1.83 per share for the full year.
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