Compaq Computer last night reported first-quarter earnings that met expectations on basically flat revenues, as the world's largest personal computer maker struggled with a slow transition to direct sales and a lingering Year 2000-related slowdown.
Compaq, which employs 2,200 people in Dublin, Galway and Belfast, posted net income of $325 million (€351 million), or 19 cents per share including a three cent investment gain, compared to $281 million, or 16 cents per share, a year ago. Its revenue rose to $9.51 billion from $9.42 billion.
Financial analysts expected Compaq to report earnings of 16 cents per share before one-time items, according to research firm First Call/Thomson Financial, which surveys broker estimates.
The company said its first-quarter earnings grew 0.8 per cent from the fourth quarter. As a percentage of revenues, profit margins fell 1.7 per cent from the first quarter of 1999. Compaq has been losing ground in PC sales to rivals such as Hewlett-Packard and Dell and expanding into booming markets for servers to balance falling prices in PCs.
Compaq's chief executive, Mr Michael Capellas, said in January to expect the quarter to start slow, and to pick up towards the end with the release of Microsoft's Windows 2000 operating system.
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