After Hours
Tech plunges on Nortel, Palm news
By Nicole Maestri, CBS.MarketWatch.com
Last Update: 4:52 PM ET Mar 27, 2001
NEW YORK (CBS.MW) - The day's tech rally quickly ended as Nortel Networks warned that first-quarter results will fall below expectations, and Palm said it's cutting 250 jobs and expecting a fourth-quarter loss.
After nine of the Nasdaq's top 10 volume movers traded in the green in the regular session, tech shares lost their footing after hours, with Cisco (CSCO: news, msgs, alerts) down 3 percent, JDS Uniphase (JDSU: news, msgs, alerts) down 2.7 percent, Ciena (CIEN: news, msgs, alerts) off 3.4 percent and Juniper Networks (JNPR: news, msgs, alerts) sliding 2.4 percent.
Shares of Biogen also retreated. The company said it's comfortable with its earlier earnings targets, but those numbers fall slightly below analyst expectations.
In the broader markets, both the Dow Industrials and the Nasdaq traded in the green. A buying interest for tech stocks helped boost the Nasdaq higher, with the software sector making the biggest advances. Read Market Snapshot.
Nortel Networks
Nortel said it expects to report a first-quarter loss of 10 cents to 12 cents, wider than the 4-cent estimate the company had been expecting.
The company said it continues to feel the impact of the U.S. downturn.
Palm
Palm shares were halted as the company reported third quarter results that beat expectations but said its cutting jobs and predicting a fourth-quarter loss.
Palm said it would cut its staff by approximately 250 employees and contract workers. The maker of the popular Palm hand-held device also anticipates reporting a net loss of 8 cents in the fourth quarter, along with sales in the range of $300 million to $315 million.
For its third quarter, Palm reported pro forma income of $9.3 million, or 2 cents a share. That's a penny better than what analysts surveyed by First Call/Thomson Financial had been anticipating.
Sales in the third period reached, $470.8 million, a 73 percent increase from the $272.3 million reported at the same time last year.
Ahead of the news, shares of Palm closed up $1.06 to $15.50. Before being halted, shares rose 2.4 percent on Island.
Biogen
Biogen (BGEN: news, msgs, alerts) confirmed its earlier earnings targets, saying it expects first-quarter earnings per share to fall between 45 cents and 46 cents. The company also sees full year earnings per share in the low $1.90s.
Biogen had been expected to earn 47 cents per share for its first quarter and $1.93 for the year, according to analysts surveyed by First Call.
After the news, shares traded down 1 percent to $64.38 on Island.
The company said product revenue continues to be robust.
Shares closed up 1.2 percent to $65.06 on the Nasdaq.
Psi Technologies
Psi Technologies (PSIT: news, msgs, alerts) said its first-quarter revenue will come in lower than previously expected, citing continued weakness of demand in the broader semiconductor market.
The company expects revenue between $16.5 million and $16.9 million, down compared with the previous target of $17.3 million to $18 million. Analysts polled by First Call had been expecting $18 million in revenue.
"We are adjusting our operating structure and costs in order to match the lower level of business activity," said President and CEO Arthur J. Young Jr., in a statement
Shares closed down 2.5 percent to $4.94. On Island, shares moved up 1.3 percent to $5.
Nicole Maestri is a reporter for CBS.MarketWatch.com
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