Ingram Micro Shortfall Contradicts Rosy Outlook from Data Gatherer
By Medora Lee
Staff Reporter for theStreet.com
3/11/99 12:11 PM ET
SAN FRANCISCO -- More mixed messages from the PC front. Distributor Ingram Micro (IM:NYSE) warned this morning that first-quarter earnings will fall short of analysts' expectations and set 1,400 job cuts.
The Santa Ana, Calif.-based company attributed the shortfall to intense margin pressure, year 2000 fears and economic jitters in Europe, Latin America and Asia.
Ingram Micro's warning highlights the turmoil that has recently erupted in the PC market. Just last week, Compaq (CPQ:NYSE) said industry sales had been soft for the first six weeks of the first quarter in Europe and North America. Earlier this week, SG Cowen analyst Richard Chu downgraded Dell (DELL:Nasdaq), citing a survey projecting a sharp decline in PC unit sales this year.
However, International Data Wednesday forecast a healthy first quarter for PC demand, led by vibrant U.S. and Western European markets, though it said PC prices should continue to fall. The data cruncher said it expected the number of PCs shipped worldwide in the first quarter to grow 14.1% from a year ago, with the Asia-Pacific market, excluding Japan, showing more signs of a rebound. International Data said it expected 103.2 million PCs to be shipped from factories in 1999, an increase of 14.3% from 1998.
Ingram Micro shares were off 1 1/8, or 6%, at 17 1/2. Compaq was up 3/16 at 31 3/4 and Dell was down 3/16 at 43 1/8. |
