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To: DRBES who wrote (28206)	2/12/2001 10:19:47 PM
From: Paul Engel	Respond to of 275872

Re: "delL will only be laying off "temporarY" personneL in the oncoming layoffs. How does one tell "temporarY" from "permanenT" employees? " One looks to see if the Pink Slip says GATEWAY or HP on it. Gateway Slashes Workforce; HP Issues Warning By Mary Mosquera, TechWeb Finance Jan 11, 2001 (3:57 PM) URL: techweb.com Computer makers Gateway Inc. and Hewlett Packard Co. blamed the economy for earnings and sales warnings Thursday. Gateway (stock: GTW) also will slash its workforce 10 percent and take a $50 million charge in the 2001 first quarter. Gateway reported fourth-quarter results that significantly missed expectations that had already been downgraded, and also forecast sales would grow just 3 percent in 2001. Excluding charges, Gateway, the No. 2 direct PC seller, posted fourth-quarter earnings of $37.6 million, or 12 cents a share, compared with $126 million, or 38 cents, in the same quarter last year. Sales fell 6.9 percent to $2.37 billion from $2.55 billion. Gateway said lagging PC demand and increasing pricing pressures would continue at least until mid-year. "Softer sales have caused inventories of our competitors to swell, and have touched off an aggressive pricing environment that will have negative consequences for the PC sector for the next six months," said Gateway CEO Jeff Weitzen. "We need to prioritize our business initiatives against the present economic realities. Tough times call for tough decisions," he said. Full-year earnings, excluding charges, were $448 million, or $1.36 a share, 3 percent over 1999. Hewlett-Packard (stock: HWP) said again it will not meet its previous first-quarter earnings expectations due to worsening economic conditions and decelerating spending. The Palo Alto, Calif., company said it now anticipates earnings of 35 to 40 cents a share for the quarter ending Jan. 31. The First Call/Thomson Financial consensus of Wall Street analysts expected earnings of 42 cents, up from 40 cents in the year-ago quarter. In November, HP had targeted earnings around 44 cents a share. "We anticipated a slowdown in U.S. consumer IT spending and continued strength in enterprise IT spending, all in the context of the prevailing view that the U.S. economy was headed toward a soft landing," said HP CEO Carly Fiorina. "It's clear there's been a significant change in market conditions in recent weeks," she continued. "Consumer spending in the U.S. has been below even our own conservative estimates and our enterprise customers -- responding to the growing economic uncertainty -- have become increasingly cautious about IT spending." Conservative growth assumptions are appropriate in the near-term, she said. HP's gross margin guidance is at the low end of the 27.5 to 28.5 percent range the company previously disclosed, with expense growth in line with revenue growth. "Given rapidly changing market conditions and increasing economic uncertainty, at home and abroad, we're refraining from providing an update to full-year guidance at this time," she said. Hewlett Packard, a component of the Dow Jones Industrial Average, closed up 63 cents at $32.38, and Gateway, San Diego, was up $2.96 to $22.90 before the bad news hit.