Feeds

Compaq gets clobbered

Q2 profits down 81%

  • alert
  • submit to reddit

The Essential Guide to IT Transformation

Compaq has reported a Q2 profit fall of 81 per cent - $67 million down from $362 million a year earlier.

Sales slumped by 17 per cent in the period to $8.45 billion.

Compaq's PC division suffered which is unsurprising. Sales fell to $3.82 billion from $4.91 billion, but as analysts Dataquest revealed last week, Compaq's unit shipments declined by 14 per cent to 3.4 million in the period.

This is all at a time when worldwide PC shipments declined for the first time in 15 years. They dropped 1.9 per cent in Q2 - around 30.4 million units were shipped - and Dell was the only top tier PC vendor to see growth worldwide and in the US during the three-month period. It shipped four million units worldwide, a growth of 20 per cent over Q2 2000.

Compaq is getting roundly spanked in a fierce price war during a market slowdown.

The company has now said it will miss its Q3 sales targets. It's now forecasting revenues of $8 billion to $8.4 billion. In last year's third quarter, the company had net income of $550 million, or 31 cents a share, on sales of $11.2 billion

Earlier in the month Compaq said it was to axe another 4,000 staff. The worldwide layoffs will take effect by the end of this year, and bring Compaq's proposed job cut total for the year to 8,500, or around 12 per cent of its workforce.

In a conference call Chief Exec Michael Capellas said: "It's an understatement to say that we're in the midst of an extremely challenging global market.''

The server and storage business also too a pasting. Sales fell 21 per cent to $2.7 billion. ®

Related Stories

World PC shipments drop for first time in 15 years
Compaq warns of 4,000 more layoffs
Compaq to sack two notebook makers?
Compaq derides tin, praises services

The Essential Guide to IT Transformation

More from The Register

next story
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Sonos AXES support for Apple's iOS4 and 5
Want to use your iThing? You can't - it's too old
Stick a 4K in them: Super high-res TVs are DONE
4,000 pixels is niche now... Don't say we didn't warn you
Philip K Dick 'Nazi alternate reality' story to be made into TV series
Amazon Studios, Ridley Scott firm to produce The Man in the High Castle
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
Too many IT conferences to cover? MICROSOFT to the RESCUE!
Yet more word of cuts emerges from Redmond
Joe Average isn't worth $10 a year to Mark Zuckerberg
The Social Network deflates the PC resurgence with mobile-only usage prediction
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
The Essential Guide to IT Transformation
ServiceNow discusses three IT transformations that can help CIO's automate IT services to transform IT and the enterprise.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Build a business case: developing custom apps
Learn how to maximize the value of custom applications by accelerating and simplifying their development.