Re: IDC reports PC Market Share: Dell over HP by a nose; both pulling
From: Rob Young (young_r_at_encompasserve.org)
Date: 07/23/03
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Date: 23 Jul 2003 12:11:27 -0500
In article <bfmadq$hlg$2@new-usenet.uk.sun.com>, Andrew Harrison SUNUK Consultancy <Andrew_No.Harrison_No@nospamn.sun.com> writes:
> Rob Young wrote:
>
> Right so in the same period the bits of HP that you care about
> lost 472 million dollars despite bunging their R&D budget into
> a central pot funded by printing and Sun lost 292 million.
>
Ah, and there's the rub Andrew. Sun has Java and the associated
Java revenue stream to prop it up. Ah... okay, a joke. But
as Scott talks about growth and futures he declares Sun the
second largest software house (not so, IBM is that owner). Nothing
to prop Sun up.
Face it - 9 straight quarters of declining revenue highlights
a company in decline.
> Nice try Rob but another abject failure on your part.
Hmmmm. Nice try Andrew. Much as mainframes help prop up IBM,
Office props up Microsoft, printers prop up HP, each has a profit
center. Take away SUVs and mini-vans from Ford and Chrysler (mini-vans
anyhow) and you take away their profit centers, etc.
Symbol Last Trade Change Volume
SUNW 12:49pm 3.87 -0.90 -18.87% 141,850,688
http://www.thestreet.com/_yahoo/tech/kcswanson/10102503.html
Shares of Sun Microsystems (SUNW:Nasdaq - news - commentary - research -
analysis) plunged nearly 20% a day after the company failed to offer evidence
of a turnaround to long-suffering investors, turning in weaker-than-expected
sales and net income. On a per-share basis, the hardware maker proved unable to
push its finances all the way into the black.
[snip]
"The cost of components didn't decline as fast as it did in the previous
quarter," said Sun chief Scott McNealy, explaining why gross margins fell in
the June quarter.
But he sought to evade a question about how Sun's margins are likely to fare in
the longer term, given the company's push into lower-margin hardware.
Yeah, I'd evade that one too. Selling a whole bunch of low-margin
kit is Dell's strategy. Analysts having a field day with that
strategy! But nowhere to go. Gotta do something.
Maybe if Sun had a profit center? But $12 million in profits on
nearly $3 billion in sales, ouch! Declining margins on those
hardware sales are the future Andrew. Sun needs to get a clue.
I expect that will happen in the next year. Maybe Computer Associates
buys you guys out. That would be fitting!
Rob
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