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

To: robbie who wrote (41366)	12/27/1998 7:32:00 PM
From: jim kelley	Read Replies (2) \| Respond to of 97611

Robbie Ignore this while your are at it: The company's gross margin is also falling, down to 18.5% of sales from 27.4%, as a result of falling market prices and an increase in Compaq's promotonal sales pricing. While CFO Mason attributes the margin squeeze and a bump in the cost of sales to "the integration of DEC," he's contradicted by the financial notes in Compaq's second-quarter report. In note 14, the company states that both these declines are due to "significant pricing and promotion actions taken." In other words, drastic price cuts necessitated by an industry growing increasingly competitive and commoditized.