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Earnings

Profit Reports a Mixed Bag for Technology Firms

Earnings: IBM posts 5.4% gain in second quarter, and EMC announces 71% drop amid lagging sales.

July 19, 2001|From Times Staff and Wire Reports

ARMONK, N.Y. — IBM Corp. said Tuesday that second-quarter profit rose 5.4% as sales slipped. The computer company also forecast slower second-half growth.

IBM said net income rose to $2.05 billion, or $1.15 a share, from $1.94 billion, or $1.06, a year earlier. Sales slid to $21.6 billion from $21.7 billion. Analysts on average expected earnings of $1.15 a share on sales of $22.6 billion, according to First Call/Thomson Financial.

IBM shares fell as low as $100.62 after the report. They lost $4.25 to $104.28 in regular New York Stock Exchange trading before the earnings report.

Among other technology companies reporting Wednesday:

* Applied Micro Circuits Corp., a maker of semiconductors for fiber-optic network equipment, had a fiscal first-quarter loss of $3.34 billion after writing down the value of businesses it acquired. The company said will cut 5% of its 1,169-member work force.

The loss was $11.18 a share, compared with net income of $3.4 million, or 1 cent, a year earlier. Sales fell to 44% to $41.2 million. Excluding charges, the first-quarter loss would have been $13.6 million, or 5 cents a share.

* Communications chip maker Broadcom Corp., its revenue sagging as key customers reduced their orders, lost $41.1 million in the second quarter, slightly better than analysts had expected.

Revenue should remain flat in the third quarter, resulting in another loss, chief financial officer William Ruehle said.

But Ruehle said Broadcom executives have seen "some signs of stabilization" that could put the Irvine company in the black by year's end.

Excluding charges, the second-quarter loss, of $41.1 million, or 16 cents a share, compared with a profit of $61.1 million, or 24 cents, a year ago. Analysts had expected a loss of 17 cents. Revenue fell 14% to $210.9 million.

* EMC Corp., a maker of corporate computer-data storage systems, said second-quarter profit fell 71% to $126.4 million, or 6 cents a share, from net income of $429 million, or 19 cents, a year ago. Sales dipped 6% to $2.02 billion.

Chief Executive Joseph Tucci and other executives declined to make forecasts for the rest of 2001.

* Handspring Inc.'s fiscal fourth-quarter losses were narrower than Wall Street expected and said it was cutting 9% of its work force. Sales rose 18% to $61 million.

The Mountain View, Calif.-based maker of hand-held computers reported a net loss of $67.2 million, or 60 cents a share, compared with a net loss of $19.5 million, or 43 cents, a year ago. Excluding one-time events, Handspring would have lost $32.4 million, or 29 cents a share. Analysts were expecting a loss of 32 cents a share.

* Sanmina Corp., which builds electronic equipment for other companies, said its fiscal third-quarter net income rose to $30.1 million, or 9 cents, compared with $6.9 million, or 2 cents, a year ago. Sales fell 29% to $777 million.

* Siebel Systems Inc. said second-quarter net income rose to $76.6 million, or 15 cents a share, from profit before acquisition-related charges of $49.1 million, or 10 cents, a year earlier. Revenue climbed 38% to $549.7 million.

* Symantec Corp. had a fiscal first-quarter loss of $21.2 million, or 29 cents a share on slower demand for the company's Norton computer-security software. That compared with net income of $38.4 million, or 60 cents, a year earlier. Sales rose 1.2% to $228 million.

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