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Technology Stocks : Compaq -- Ignore unavailable to you. Want to Upgrade?

To: Captain Jack who wrote (76822)	1/26/2000 9:19:00 PM
From: rupert1	Read Replies (1) \| Respond to of 97611

Captain: I like that, the way HWP came out. That's looking after your shareholders! Also helps to stop the rot in the sector tomorrow. There is no excuse for the market to exacerbate the DELL effect by suggesting that its problems may also affect others in the sector. The market now knows what happened at IBM, GTW, CPQ and HWP. It's interesting that HWP predicts growth (of revenue and profits) of 12-15% in 2000. Can anyone trust the DELL forecast of 30%? The CPQ forecast 15-17% is starting to look respectful. COMPAQ cannot do a HWP statement, because it has already made its statement and will be explaining it in detail to 50 or more analysts tomorrow. The DELL news does give it an opportunity to sharpen their presentation - I hope they don't blow it. Look at this release on the DELL situation from WSJ Interactive. I have put the last para first to show the spin they put on COMPAQ and how they link it to the DELL problem. Meanwhile, Dell's cross-state rival Compaq Computer Corp. is struggling with its own woes. Tuesday the Houston-based PC maker posted a 56% plunge in fourth-quarter income amid a 3.4% drop in revenue on weakness in both its PC and server-computer lines. Compaq has been losing market share to Dell, which for the second quarter in a row claimed the leading position in the U.S. PC market from longstanding leader Compaq. January 26, 2000 Dell Computer Issues Profit Warning On Chip Shortage, Y2K Sales Slump An INTERACTIVE JOURNAL News Roundup Dell Computer Corp. announced late Wednesday that it will report lower-than-anticipated revenue and earnings for the fiscal fourth quarter ending Jan. 28. In a statement, the Round Rock, Texas, computer maker said a shortage of semiconductor components and weaker-than-expected sales to corporate customers related to the Y2K rollover were primary reasons for the shortfall. PC-Sales Growth Slowed Down in Fourth Period, Raising Brows (Jan. 24) Company Profile: Dell Computer The company will announce its financial results on Feb. 10. Dell said profits are expected to be about $430 million, or 16 cents a share, including a penny-a-share gain from the sale of investments. The company expects revenue of about $6.7 billion for the fourth quarter, which would be up 30% from the prior-year period. Unit volumes are expected to increase more than 30% on a fiscal-quarter basis, and 50% on a calendar-quarter basis. The consensus of analysts' earnings estimates for the quarter was 21 cents per share. Dell said a the shortage of chip components during the quarter caused $300 million in lost sales, primarily of newly introduced consumer products. Dell also said corporate demand following the Y2K rollover was lower than anticipated, reducing expected revenue by about $500 million. "While we're clearly disappointed with our operating results, our overall business is healthy and we believe Dell will continue to significantly outpace the revenue and profit growth of our major competitors and of the industry at large," Tom Meredith, Dell's chief financial officer, said in a statement. Chip-shortage woes also hurt San Diego-based Gateway Inc.'s bottom line in the fourth quarter. Gateway earlier this month warned that fourth-quarter earnings will miss targets because of chip-supply problems and a Y2K-related sales slowdown. Gateway said a shortage of Intel Corp. microprocessors and motherboards trimmed $200 million to $250 million from fourth-quarter revenue. Intel, the world's largest maker of semiconductors, has had problems meeting robust demand for its chips and motherboards because of low inventory levels and manufacturing glitches and said earlier this month that it received more orders in the fourth quarter than it could fill. The Santa Clara, Calif., company promised to spend some $5 billion this year on new plants and equipment in order to meet all demand in 2000. Meanwhile, Dell's cross-state rival Compaq Computer Corp. is struggling with its own woes. Tuesday the Houston-based PC maker posted a 56% plunge in fourth-quarter income amid a 3.4% drop in revenue on weakness in both its PC and server-computer lines. Compaq has been losing market share to Dell, which for the second quarter in a row claimed the leading position in the U.S. PC market from longstanding leader Compaq.