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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: Dan3 who wrote (112195)	10/2/2000 8:59:44 PM
From: puborectalis	Respond to of 186894

PC downturn? Been there, done that October 02, 2000 12:00 AM PT Man, the problems in the computer industry today are so 20th century. Warnings of earnings shortfalls, concerns over the strength of the PC business, stock plunges. Intel (INTC) warned analysts that the current quarter will not meet expectations and the whole PC sector takes a hit. Oh, no! Are we reaching the saturation point for PCs? Then Steve Jobs drops a last-minute bombshell the day before its quarter ends, and Wall Street explodes. What's all this talk about PCs, anyway? We thought this was the Internet age. This is not the first time we've gone through this type of cycle: Warnings to Wall Street that it took the company's "guidance" a little too far, stock plunges, earnings are actually released, stock plunges some more, lawsuits, cleanup and restructuring, and then we all start with a nicely laundered slate. I'm sure it will be the last, though, right? I mean, we've got all this technology to instantly track sales and orders and inventories and sell-through … Hey, let's cut these folks some slack, right? They have a lot on their minds. Steve Jobs, in fact, is running two companies, Apple (AAPL) and Pixar (PIXR). We can't expect everyone to know all the details of the their current financial situation. Not until all the facts are in, which means the night before the quarter closes. You used to write term papers in college, right? How late were you up the night before deadline? Blame ERP Besides, it's not so easy to use all this new technology when tracking your financial performance. None of the rest of us can use our computers properly; you expect the CEO of a tech company to do any better? I know! Let's blame the ERP systems. Millions invested and we end up with the most expensive way to waste time and energy since the pyramids were built. And you know what's going to happen. All that lobbying to make it tougher for those earnings report-chasing lawyers to file frivolous lawsuits down the toilet. You can just bet the suits are coming back. OK, sure, we've seen a little … polishing of the books before. Companies that shipped bricks instead of computers, revenues that rose steadily and spectacularly quarter after quarter, suddenly to plummet all at once. 'Tis the season to clean up the books. Then the executive oustings and restated financials for previous quarters. We're sure that is not happening this time. Remember when all the analysts and economists couldn't figure out why PCs were failing to give us measurable productivity gains? Then one day we come back from lunch and it seems that even Al Greenspan accepts the fact that our productivity has grown faster than a politician's ad budget before an election. You've got to admit, the computer industry adds a lot to the economy, and not only from the direct revenues to the industry. Just think of all the money those shareholder lawyers have to spend on new Rolex watches and BMW sports cars. We're sure the gold chain market is very robust. If you're worried about the PC business, just shift your money into the jewelry markets. Not the end Is this really the end of the PC business, at long last? How many microprocessors does Intel say it ships per year, 120 million? No, this is not the beginning of the end. This is simply déjà vu all over again. Write off the quarter, wait for the lawsuits to settle, and it will come back again. Microsoft (MSFT) still has too many spectacular new products that you're just going to have to buy a new computer to enjoy. Remember, in the 1970s we thought the world was running out of oil just because we had to line up at the gas station to watch prices correct themselves upward. We wonder, though, how much these young Internet entrepreneurs are learning from their elders. They need to take note of this quarter. They haven't even learned how to report earnings, let alone earnings shortfalls. Watch Jobs in particular. He's a master at this. But don't blame Jobs. Remember, he's been doing a spectacular, astounding turnaround job, without even introducing any new technology. All he had to do was unveil some new colors and cool boxes. Why, it almost seems too good to be true. Especially to those lawyers.