SGI loss widens beyond expectations

MIPS to blame thanks to delayed 400MHz R12000, says company

SGI saw its loss widen and sales fall during its third fiscal quarter, the troubled hardware vendor admitted yesterday. Revenues for the quarter totalled $563.7 million, down nine per cent on the figure of $619.2 million SGI recorded for the same period last year. Q3 2000 also saw SGI's loss reach $18.1 million. That's significantly better than the year-ago quarter's loss of $40 million, which shows at least that the company's recovery plan is making a difference. The trouble is, Wall Street expected that plan to have made more of an impact than it actually has. First Call's round up of analysts' earnings estimates put SGI's loss a seven cents a share - yesterday's announcement saw the loss hit ten cents a share. SGI CEO Bob Bishop blamed the sales shortfall - and resulting increase in the company's loss - on the delayed introduction of MIPS' 400MHz R12000 processor. The fact that SGI has managed to more than halve its losses over the last 12 months does, however, offer cause for optimism. SGI has at last rid itself of its supercomputer operation, Cray (which brought a $21 million addition to the quarter's loss, though SGI expects it to eventually result in a $15 million gain), and the various sales and shutdowns since its summer 1999 reorganisation should, result in a leaner company better focused on the server market. ® Related Stories SGI finally sells off Cray SGI misses break-even by $1 million

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