To: Bill Harmond who wrote (117268 ) 2/10/2001 9:51:02 AM From: H James Morris Read Replies (2) | Respond to of 164684 Get a grip Bill! Don't you have a clue what's going on? The archives here show that your clueless. You live in fantasy land. If I was you I'd put everything I have into Disney! >Published: February 9 2001 18:44GMT | Last Updated: February 10 2001 00:14GMT Shares of Dell Computer plunged on Friday after analysts warned that the personal computer maker was gearing up to make the first significant round of job cuts in its history. Shares closed on Friday at $23.5, down 9.8 per cent. The Texas-based company on Friday refused to comment on the reports, saying they were based on speculation and rumour. But industry watchers said that it was growing increasingly likely that Dell was preparing to announce lay-offs when it reported its fourth quarter results on Thursday. "They really need to make the cut backs," said Richard Chu of SG Cowen. "The company has been getting quite fat in terms of workforce." He said Dell had mis-timed an aggressive expansion in its workforce in its internet-based sales operation just as global PC demand showed signs of slowing. Ashok Kumar of US Bancorp Piper Jaffray said he had heard the company was now planning to cut its budgets by about 8 per cent across the board. "Dell is a company with relatively few fixed costs so most of the reductions would have to come in headcount," he added. An 8 per cent cut in Dell Computer's 36,500-strong workforce would add up to more than 2,900 job losses. Shares in Dell Computer fell almost 8 per cent to $24 in afternoon trade. The stock has lost more than 60 per cent of its value in the past year following a string of earnings warnings from the company. In January Dell lowered its fourth-quarter earnings forecasts by as much as 30 per cent as continued to feel the impact of slowing global demand for PCs. Its margins took a hit as it continued an aggressive round of price cuts across its product range, aimed at building on its market share. At the time Michael Dell, chief executive, signaled that he was focusing on controlling operating costs as the US economy showed signs of weakening. On Friday the company said operating costs remained centre stage. "We're going to make sure that our cost structure is consistent with the current environment. What form that takes we'll discuss when we've got the information," said a spokesman. If Dell does make substantial job cuts, it will raise fears that it is not seeing any early bounce back in the slowdown in PC demand. Hewlett-Packard recently said it was reducing its workforce by about 2 per cent to cut costs. In January Gateway Computer said it was cutting 10 per cent of its staff.