Intel, Dell sending mixed signals on tech recovery
Technology stocks are sending strong signals about the future of the economy 鈥� but in opposite directions.
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Chipmaker Intel Corp. on Tuesday stronger-than-expected sales of $8 billion and a net loss of $398 million for the second quarter. Excluding a fine from the European Commission, the world's largest semiconductor manufacturer earned 18 cents a share, more than double what a survey of analysts anticipated. It's considered a bellwether for other technology stocks.
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On the same day, PC-maker Dell Inc. lower revenues and higher prices for parts would squeeze its profit margins this quarter. Its shares dropped 8.1 percent Tuesday. Sun Microsystems Inc. also lowered its earnings guidance, ahead of its projected merger with Oracle Corp.
About the only clear trend is the change in the technology pecking order.
Microsoft Corp. will release its new operating system, Windows 7, this fall. In high tech's go-go years in the '90s, the release of a new Windows operating system always sparked new sales of computers. This time, even Microsoft's usually ebullient CEO was hedging his bets, according to on The New York Times website.
鈥淗opefully, Windows 7 will be part of a catalyst,鈥� said Steven A. Ballmer, Microsoft鈥檚 chief executive, during a speech Tuesday. 鈥淢aybe it will. Maybe it won鈥檛.鈥�
So which technology company is beating the odds, even in this tough recession?
Apple. Routinely trumped by Microsoft during the 1990s, it Tuesday that users had just downloaded their 1.5 billionth application from its App Store in just one year.
鈥淭he App Store is like nothing the industry has ever seen before in both scale and quality,鈥� said company CEO Steve Jobs in a statement. 鈥淲ith 1.5 billion apps downloaded, it is going to be very hard for others to catch up.鈥�
