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To: The Duke of URL© who wrote (96453)	3/21/2002 5:59:58 PM
From: Elwood P. Dowd	Respond to of 97611

H-P Services Chief: Unit's 2Q Results 'Well Below Plan' Updated: Thursday, March 21, 2002 05:16 PM ET NEW YORK (Dow Jones)--On the eve of the Hewlett-Packard Co. (HWP, news, msgs) shareholder vote on the proposed merger with Compaq Computer Corp. (CPQ, news, msgs), the head of H-P's services unit informed her managers the unit's revenue and profit were "well below plan" so far this quarter. In a memo dated March 18 and obtained Thursday by Dow Jones Newswires, Ann Livermore, president of H-P Services, wrote, "Another cause for concern is that incoming (services) order levels remain very soft." Hewlett-Packard's fiscal second quarter ends April 30. On average, analysts expect the Palo Alto, Calif., company to deliver earnings per share of 25 cents and revenue of $11.12 billion, according to Thomson Financial/First Call. When H-P reported its first quarter it forecast a modest sequential revenue decline from the first quarter's $11.38 billion. Services revenue accounted for more than 16% of the company's total in the last fiscal year, which ended Oct. 31. The unit generated more than 20% of the company's operating earnings for the period. In the memo, Livermore also wrote that "the potential distraction" from the vote on the $20 billion proposed merger was having "an impact on employee productivity and customer decision making." Carly Fiorina, H-P's chief executive, Tuesday declared a tentative victory in the proxy battle she fought against dissident director Walter Hewlett. Still, the official vote tally could take weeks to complete, and Hewlett has yet to concede defeat. In an interview Thursday, Livermore said the memo was a regular quarterly " rallying cry" that she sends to her managers. She declined to comment on her unit's performance so far this quarter, but noted the services business is back-end loaded, meaning most of the revenue comes in toward the end of a quarter. Livermore also said she was "absolutely, one-hundred-percent proud and thrilled" at where her team is right now.

To: The Duke of URL© who wrote (96453)	3/21/2002 7:48:34 PM
From: Elwood P. Dowd	Read Replies (1) \| Respond to of 97611

Check this out! A tech stock split!! First one I've seen in about 2 years!!! Very bullish, imo. El An Upbeat Applied Materials Announces a Split By Adam Feuerstein Staff Reporter 03/21/2002 07:26 PM EST Applied Materials (AMAT:Nasdaq - news - commentary - research - analysis) is optimistic enough in its recent stock gains to split its shares 2-for-1. CFO Joe Bronson quipped at the chip-equipment maker's analyst meeting Thursday afternoon that those investors who missed the company's stock at $30 would get another shot -- after the split. Applied shares closed Thursday at $52.02, up 2%. It continued to rise after hours and was up 1.9% on Instinet. Applied presented a humble but positive outlook on its future, heralding its strong position in the next-generation 300mm equipment favored by Intel (INTC:Nasdaq - news - commentary - research - analysis), the leading chip-equipment buyer. Executive Vice President David Wang sketched out a scenario that chipmakers have depleted excess equipment and gotten their factory utilization rates back up from a dismal 35% average to 50% to 55% today. Wang thinks that by year-end that figure could be as high as 80% again, as the chip up-cycle kicks in. As many in the industry have suggested, chipmakers using the most cutting-edge methods are already fully utilizing their manufacturing facilities. Another potential growth prospect for Applied is the depressed dynamic random access memory, or DRAM, arena, where manufacturers have put off equipment upgrades. Wang quoted a general figure of tripled prices for DRAM in the past several months, while DRAM player Micron (MU:NYSE - news - commentary - research - analysis) announced after the bell that its average selling prices jumped 70% in the quarter. As DRAM makers begin to see profits again, Wang thinks Applied will see purchases of newer equipment in the 300mm and in other new technologies DRAM makers haven't been splurging on during the past year. The executive sees increasing revenue in Applied's future at long last due to a convergence of positive events. "From the economic environment to electronic equipment inventory, to utilization of fabs, to DRAM price to wafer fab equipment -- each one of them is showing a positive sign for us." Micron's Thursday revenue shortfall and the growing feeling that the bold second-half PC recovery that chipmakers have been hoping for might not show up could temper those factors. Applied Materials believes its market share in 300mm is 10% better than its share of the 200mm markets, but expects that to drop by 2004 as more companies embrace the new technology. The company is not unhappy with its 200mm business, however, because less-advanced manufacturers in China are currently driving sales in the older equipment.