GATEWAY

Computer maker Gateway says it expects fourth quarter revenue of about US$2.55 billion this year, about equal to last year's US$2.45 billion, but US$500 million below previous estimates.

Gateway says it expects sales not to meet previous estimates, although the company anticipates that consumer sales will continue ramping up during the fourth quarter. "The economic slowdown, coupled with ongoing shifts in PC seasonality, clearly had a significant impact on our sales over the holiday weekend," Gateway adds.

Gateway still expects operating income growth of 25% this year. As reported earlier, Merrill Lynch & Co. (MER) analyst Steven Fortuna cut fourth quarter revenue estimates for Gateway to US$3.04 billion from US$3.14 billion. The analyst said in a research note that Gateway was expected to announce that while volume showed improvement, it would not be as strong as originally hoped.

DELL

Dell officials said they expect revenue for their 2002 fiscal year, which begins in February, to climb by about 20% from the current year. The forecast marks continued downward revenue-growth trend from Dell, which once wowed Wall Street with its high growth rate. In January, Dell warned that revenue for the current fiscal year would grow in the low-30% range, down from historic levels near 50%. The company reduced the figure even further in a warning, saying that full-year revenue would increase by only about 27% from last year. Some observers said the company's new 20% figure for the 2002 fiscal year appears to be an attempt by Dell executives to avoid having to issue any more negative revisions.

Revenue for the third quarter came in at $8.26 billion. Previous expectations had been for Dell to record about $8.5 billion in third-quarter sales. The $8.26 billion figure marked a 22% improvement from sales of US$6.78 billion in the year-ago period.

IBM

IBM posted earnings of US$21.78 billion in the third quarter of this year, below market expectations of US$22.5 billion. Jay Stevens, an analyst at Buckingham Research Group said that every major category at IBM was down from what he had expected. He noted that IBM tried to make it clear that had the company not faced supply shortages, it would have better revenue growth. During a conference call to discuss earnings with analysts IBM said it was hampered by supply shortages for wafers and ceramic substrates. Analysts have said that IBM's revenue will be flat going forward.

ACER

Taiwan's largest personal computer maker, Sunday lowered its 2000 net profit forecast to between NT$7.9 billion ($1=NT$32.076) and NT$8.1 billion from the original estimate of NT$12 billion, as demand and shipments decline amid a slowdown in the global computer industry.

Acer also cut its full-year sales target to between NT$105 billion and NT$110 billion from the original NT$150 billion, the company said in a news release. Acer said it has felt pressure from a decrease in PC demand. It also said it will see its revenue decline by around NT$20 billion, resulting from a cut in contract orders from a multinational customer this year. Many computer companies in the US have all warned that their third-quarter sales wouldn't meet forecasts, signalling a slowdown in the computer industry. Many US companies blamed the fall of the euro, which has raised prices of non-European-made computers in Europe.

COMPAQ

Bucking the general trend, Compaq returned its troubled commercial PC business to profitability after four money-losing quarters. The division - which accounted for 33% of the company's second-quarter revenue - posted an operating profit of $62 million on a 3% increase in revenue to $3.3 billion. There were other areas of strength (the server and storage division) and a couple of weak spots as well (the consumer side, where a North American price war drove down operating income despite a sharp increase in revenues, and global services, where both revenues and income fell). Compaq's report is sure to add fuel to the debate over the vitality of the PC market. According to Dataquest, US PC sales increased just 12% during the second quarter, sharply slower than the 29% jump of a year ago. IDC put second-quarter growth even lower, at 7%.

HEWLETT PACKARD

Despite earnings warnings from personal computer makers Apple Computer Inc. (AAPL) and Gateway Inc. (GTW), Hewlett-Packard Co. (HWP) is still confident it will reach its fiscal 2001 revenue growth target of between 15% and 17%, said Carly Fiorina, president, chairman and chief executive. During H-P's Security Analyst Meeting, which was broadcast via the Internet, Fiorina said that 2001 will be the biggest year in terms of new product introductions in its laser printing business. The company is also accelerating growth in its enterprise business, which she said should grow from 9% year over year to above "Hp's average," said Fiorina. She added that enterprise growth will be above the market growth rate.

As for retail PC sales in 2001, the executive said PCs are still selling but at a slower rate than in 2000. Therefore Fiorina said H-P is looking for single digit growth for US PCs in 2001. In the company's software business, Fiorina said the Palo Alto technology concern is making important investments and acquisitions in the software space. Fiorina forecasted that software growth will track higher than the rest of the market in 2001. This year, HP divested software assets and restructure others, she noted.