Compaq Sticking With Europe Through Currency Turbulence, Chief Says
By: Bob Keefe
10/31/00 10:45:00 AM
Source: Cox News Service
SAN DIEGO - Volatility in European currency markets will hurt Compaq Computer Corp.
in the fourth quarter and will continue to be a concern through next year, but the world's
biggest personal computer maker isn't changing the way it does business overseas,
Compaq's chairman said Monday.
``The only good news about Europe is that we've been in the European market for a very
long time,'' Compaq Chairman Michael Capellas said in an interview Monday. ``We do
know how to follow trends. We do know how to play the currency game very well. But if
you're an amateur in this market, you're going to get burned.''
Last week, Houston-based Compaq reported strong
third-quarter earnings, but warned its fourth-quarter
profits would miss analysts' estimates because of the
weakness in the euro.
About one-third of Compaq's sales are made in
Europe. Domestically, the company ranks No. 2
behind Round Rock, Texas-based Dell Computer
Corp., according to the latest figures from researcher
Gartner Group Inc.'s Dataquest unit.
Dell also recently warned that its third-quarter
earnings will be below expectations, also in part
because of weakened demand in Europe related to
the decline of the euro.
Europe's common currency rose Monday for the
third day in a row, but has been in a tailspin since
August in the wake of a softening economy overseas
and a continued strong economy in the United
States. Monday, the value of a euro closed at 84.28
U.S. cents, just slightly better than its all-time low of
82.30 cents last Thursday.
While the decline has prompted some U.S.
companies to re-evaluate their European
operations, Capellas said doing so at Compaq would be short-sighted.
``We're not leaving Europe, we're not backing off, but there is certainly some volatility,''
said Capellas, who spoke at a technology conference north of San Diego on Monday.
``The companies that don't have volatility right now in their reporting must not have a
presence in Europe, because it's its impossible not to have been caught in the volatility of
the currency rate,'' he said.
Monday, Compaq shares closed at $30.25, up 30 cents.
(The Cox web site is at coxnews.com)
c.2000 Cox News Service
Email this story to a friend
Click for printer-friendly format
Related News
Nortel Networks Completes - PR
Newswire
Compaq Announces Enhanced
- PR Newswire
Investor Dispatch:
HTML edition
Investor Dispatch
News.com Dispatch
All Newsletters
More from CNET Investor: Market Update | My Portfolio | Broker Reports | IPOs | Splits | Play the Game
Click Here for Fidelity Investments(R)
CNET Services: Stock Quotes • Tech Auctions • Tech News • Free Downloads • Search • Games • Latest PCs •
Business Solutions • Hardware Buying Advice |
