The possibility of job cuts at Compaq Computer's Irish operations was not ruled out yesterday after the firm lowered sales and earnings forecasts for the second quarter.

The technology firm, which employs about 2,200 people in Galway, Dublin and Belfast, said late on Tuesday it would cut a further 1,500 jobs worldwide to shore up its profits.

The Republic has so far escaped 7,000 job cuts announced this year. However, a Compaq Ireland spokeswoman contacted yesterday did not rule out job cuts.

She said no decision had been taken by Compaq because the firm had yet to break down the job cuts by region.

In its statement late on Tuesday, Compaq said it was affected by the declining value of the euro, as well as weaker than expected sales in Britain, Germany and Switzerland.