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To: Techplayer who wrote (60186)	2/27/1999 11:16:00 AM
From: Bindusagar Reddy	Read Replies (3) \| Respond to of 61433

Brian, One more big reason for apparant slowdown in January Compaq shipments was TYPICAL POSTPONEMENT OF ORDERS AWAITING PENTIUM III. This happens all the time when there is aproduct upgrade. It happened wen Pentium II was released. They have already seen a pickup in demand second half of february and they may not be able to ship all the orders in time for March Q. The demand for PCs will continue through next century. No worry. Biggest concern is how low the prices go causing apparant slowdown in revenues without slowing of unit growth. Regards, BR

To: Techplayer who wrote (60186)	2/27/1999 11:41:00 AM
From: Bindusagar Reddy	Read Replies (1) \| Respond to of 61433

This from Barrons today. Milunovich (MLananlyst)still sees 15% unit growth in personal computers this year, but because prices are falling, revenue growth may be just 5%-7%. (I think PC growth will be 30% unit and revenue growth 5-7% IMHO) His view: A slowdown in revenue growth may make it tough for PC makers to hit their ambitious profit targets. The Compaq setback came a week after Wall Street's disappointment with Dell Computer's fourth-quarter revenue growth, which prompted a sharp decline in Dell's stock. "The issue is whether the personal-computer industry is slowing down," says Steve Milunovich, Merrill Lynch analyst, who Friday cut his first-quarter profit estimate for Compaq to 30 cents a share from 35 cents. He also trimmed his 1999 estimate to $1.75 from $1.80. Milunovich's earnings revision admittedly was mild, but it's worth noting that a month ago, there were whispers on Wall Street that Compaq might earn $2 a share this year. The reaction to the Compaq news was severe because so many momentum-oriented investors focus on profit revisions.