Close
  • Latest News
  • Artificial Intelligence
  • Big Data and Analytics
  • Cloud
  • Networking
  • Cybersecurity
  • Applications
  • IT Management
  • Storage
  • Sponsored
  • Mobile
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
Read Down
Sign in
Close
Welcome!Log into your account
Forgot your password?
Read Down
Password recovery
Recover your password
Close
Search
Logo
Logo
  • Latest News
  • Artificial Intelligence
  • Big Data and Analytics
  • Cloud
  • Networking
  • Cybersecurity
  • Applications
  • IT Management
  • Storage
  • Sponsored
  • Mobile
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
More
    Home Latest News
    • PC Hardware

    Compaq Scrambles to Cut Expenses

    By
    eWEEK EDITORS
    -
    July 16, 2001
    Share
    Facebook
    Twitter
    Linkedin

      Compaq Computer Corp.s announcement last week that it was lowering revenue estimates and cutting more jobs was the latest example of a company desperate to slash operating expenses.

      Fighting a softening economy and a price war in the PC industry, the Houston computer maker announced it will miss already-lowered estimates for the quarter and will lay off 1,500 more workers on top of the 7,000 already announced.

      Company executives said revenue for the just-completed quarter would fall short by about $600 million. Despite missing revenue projections, Compaq said it expects to post earnings of 4 cents per share, in line with current Wall Street projections. The company will officially report its earnings July 25.

      Earlier this month, Compaq, which has worked to streamline its product lines, said it is halting production of its high-end Alpha processor, instead embracing Intel Corp.s Itanium chips. But industry observers said the move is another in a series of bad ones by the company.

      “I think theyre trying to save money the wrong way,” said David Dachtera, an independent contractor with DJE Systems, in Elmhurst, Ill., who criticized Compaqs decision to abandon the Alpha processor. “The problems with Compaq are not simple … and one problem is Compaq is always going to be seen in the marketplace as a PC company. Theyve never really been able to do anything to shed that image or do anything positive to make that happen for them.”

      In hopes of boosting earnings, CEO and Chairman Michael Capellas told employees in an internal memo that Compaq, which draws most of its revenue from hardware sales, will increasingly focus on building up its services and software businesses. But with no rebound in site, the company will press for more spending cuts.

      Compaq will take a $490 million charge to cover expenses tied to the job cuts and streamlining. In all, Compaq will cut 8,500 jobs this year.

      Facing increased pressure from rival Dell Computer Corp., Compaq is visibly struggling. One problem, said analyst Andy Neff, of The Bear Stearns Cos. Inc., in New York, is that Compaq is working to stem losses rather than build a solid foundation for future growth.

      eWEEK EDITORS
      eWeek editors publish top thought leaders and leading experts in emerging technology across a wide variety of Enterprise B2B sectors. Our focus is providing actionable information for today’s technology decision makers.
      Get the Free Newsletter!
      Subscribe to Daily Tech Insider for top news, trends & analysis
      This email address is invalid.
      Get the Free Newsletter!
      Subscribe to Daily Tech Insider for top news, trends & analysis
      This email address is invalid.

      MOST POPULAR ARTICLES

      Latest News

      Zeus Kerravala on Networking: Multicloud, 5G, and...

      James Maguire - December 16, 2022 0
      I spoke with Zeus Kerravala, industry analyst at ZK Research, about the rapid changes in enterprise networking, as tech advances and digital transformation prompt...
      Read more
      Applications

      Datadog President Amit Agarwal on Trends in...

      James Maguire - November 11, 2022 0
      I spoke with Amit Agarwal, President of Datadog, about infrastructure observability, from current trends to key challenges to the future of this rapidly growing...
      Read more
      IT Management

      Intuit’s Nhung Ho on AI for the...

      James Maguire - May 13, 2022 0
      I spoke with Nhung Ho, Vice President of AI at Intuit, about adoption of AI in the small and medium-sized business market, and how...
      Read more
      Applications

      Kyndryl’s Nicolas Sekkaki on Handling AI and...

      James Maguire - November 9, 2022 0
      I spoke with Nicolas Sekkaki, Group Practice Leader for Applications, Data and AI at Kyndryl, about how companies can boost both their AI and...
      Read more
      Cloud

      IGEL CEO Jed Ayres on Edge and...

      James Maguire - June 14, 2022 0
      I spoke with Jed Ayres, CEO of IGEL, about the endpoint sector, and an open source OS for the cloud; we also spoke about...
      Read more
      Logo

      eWeek has the latest technology news and analysis, buying guides, and product reviews for IT professionals and technology buyers. The site’s focus is on innovative solutions and covering in-depth technical content. eWeek stays on the cutting edge of technology news and IT trends through interviews and expert analysis. Gain insight from top innovators and thought leaders in the fields of IT, business, enterprise software, startups, and more.

      Facebook
      Linkedin
      RSS
      Twitter
      Youtube

      Advertisers

      Advertise with TechnologyAdvice on eWeek and our other IT-focused platforms.

      Advertise with Us

      Menu

      • About eWeek
      • Subscribe to our Newsletter
      • Latest News

      Our Brands

      • Privacy Policy
      • Terms
      • About
      • Contact
      • Advertise
      • Sitemap
      • California – Do Not Sell My Information

      Property of TechnologyAdvice.
      © 2022 TechnologyAdvice. All Rights Reserved

      Advertiser Disclosure: Some of the products that appear on this site are from companies from which TechnologyAdvice receives compensation. This compensation may impact how and where products appear on this site including, for example, the order in which they appear. TechnologyAdvice does not include all companies or all types of products available in the marketplace.

      ×