Feeds

Compaq results – oh dear

Dire PC business to get Delled up

  • alert
  • submit to reddit

Build a business case: developing custom apps

Compaq has been hit with a hefty Q3 loss - worse than the market expected, and the market wasn't expecting much - in the first results the company has posted since announcing its takeover by Hewlett-Packard.

Compaq says Q4 will be equally bad.

The computer giant has posted a net loss of $499 million, compared with a profit of $557 million in Q3 2000. It took a $379 million spanking on its investment in Internet incubator CMGI, so lost $120 million by itself.

Sales fell 33 per cent to $7.48 billion, below analysts' expectations of $7.53 billion.

Chief exec Michael Capellas said: "We do not anticipate dramatic changes in corporate IT spending, particularly through the first half of 2002. As for the fourth quarter of 2001, we expect revenue to be in the range of $7.6 to $7.8 billion and a loss of about $0.03 per share.

September 11 was top of the blame list for Q3. "The third quarter was one of the most challenging ever for Compaq and for our industry," according to Capellas.

He was pleased with services and enterprise technology sectors which "performed well given overall market conditions." Revenue in Compaq Global Services was $1.9 billion, two per cent year-on-year, with operating profit improved to $284 million. The services business accounts for 25 per cent of Compaq's revenue, up from 23 per cent in Q2.

The company's enterprise computing segment reported a loss of $104 million on revenue of $2.4 billion - 32 percent of third quarter revenues

But as for PCs. Oh dear. Compaq's PC business lost $248 million for the quarter. Sales of $3.26 billion were down 42 per cent from $5.6 billion a year earlier, when the business was profitable. The company says it will sort this out by doing a bit of a Dell and increasing direct sales, reducing operating costs and improving product lines. But it concedes it's not going to be profitable for the next few quarters. ®

Related Link

Compaq statement

Boost IT visibility and business value

More from The Register

next story
Microsoft exits climate denier lobby group
ALEC will have to do without Redmond, it seems
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
Barnes & Noble: Swallow a Samsung Nook tablet, please ... pretty please
Novelslab finally on sale with ($199 - $20) price tag
Ballmer leaves Microsoft board to spend more time with his b-balls
From Clippy to Clippers: Hi, I see you're running an NBA team now ...
Kate Bush: Don't make me HAVE CONTACT with your iPHONE
Can't face sea of wobbling fondle implements. What happened to lighters, eh?
Video of US journalist 'beheading' pulled from social media
Yanked footage featured British-accented attacker and US journo James Foley
Amazon takes swipe at PayPal, Square with card reader for mobes
Etailer plans to undercut rivals with low transaction fee offer
Assange™: Hey world, I'M STILL HERE, ignore that Snowden guy
Press conference: ME ME ME ME ME ME ME (cont'd pg 94)
Call of Duty daddy considers launching own movie studio
Activision Blizzard might like quality control of a CoD film
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.
Top 10 endpoint backup mistakes
Avoid the ten endpoint backup mistakes to ensure that your critical corporate data is protected and end user productivity is improved.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Rethinking backup and recovery in the modern data center
Combining intelligence, operational analytics, and automation to enable efficient, data-driven IT organizations using the HP ABR approach.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.