Leigh,
Hi!!
RE: IBM (nyse: IBM) yesterday reported first quarter earnings per share of 83 cents, beating expectations by a nickel. But overall revenue of $19.5 billion was down 5% compared to the same period in 1999. Hardware revenue for the quarter was down 12%, to $7.7 billion. Within the hardware segment, personal systems--which include desktops, portables and PC servers--took the biggest hit.
PC profitability has eluded IBM for years. In 1998, IBM lost almost $1 billion on PCs, and over half a billion dollars in 1999. In fact, since IBM started to break down operating earnings in 1998, the company hasn't once reported profits in the personal systems segment.
For the past three quarters, IBM has blamed a Y2K lockdown for the decline in mainframe and large server sales, and inefficient distribution channels and harsh retail environment for continuing losses in PCs.
Now those excuses are beginning to sound a little worn, and the pressure is on chief executive Louis Gerstner to prove that the company that invented the personal computer can still make money off its brainchild.
Eventually, they'll come along..
Best, Kemble |
