Markets & Finance

Microsoft Second-Quarter Profit Slips


After the close of trading Thursday, Microsoft (MSFT) posted second-quarter earnings per share of 14 cents, vs. 17 cents. Excluding stock-based compensation expenses, the software giant reported 34 cents earnings per share, up from 29 cents -- analysts were expecting an average of 30 cents earnings per share. Microsoft's revenues rose 19%, to $10.15 billion. In the third quarter (Mar.), the company sees earnings per share in the range of 28 cents to 29 cents.

Eastman Kodak (EK) posted 70 cents (excluding charges), vs. 65 cents fourth-quarter earnings per share from continuing operations on a 10% sales rise. Kodak sees 80 cents to $1.30 2004 earnings per share (GAAP). The company will reduce total facility square footage by one third, and cut worldwide employment by 20%, or 12,000 to 15,000 employees.

Sandisk (SNDK) posted 94 cents, vs. 26 cents fourth-quarter earnings per share on a sharp revenue rise. The company sees a "modest" seasonal decline in product revenues of 5% to 10% sequentially. Sandisk sees $1.5 billion to $1.75 billion 2004 total revenue, and set a 2-for-1 stock split.

Performance Food (PFGC) sees 24 cents to 26 cents fourth-quarter earnings per share, and $1.52 to $1.54 2003 earnings per share. The company cited factors in its Fresh-Cut, Broadline, and Customized Divisions. AG Edwards downgraded to hold from buy.

Xilinx (XLNX) posted 19 cents third-quarter earnings per share, vs. a 1 cent loss on a 29% revenue rise. Xilinx sees 7% to 10% fourth-quarter sequential revenue growth. S&P upgraded to buy from accumulate. Schwab SoundView, Banc of America, and Wachovia also upgraded the shares.

EBay (EBAY) posted 24 cents fourth-quarter earnings per share (pro forma) on 57% higher revenue. The online auction giant posted 21 cents fourth-quarter earnings per share (GAAP). EBay believes 2004 revenue could be as high as $3 billion, with earnings per share as high as 99 cents (GAAP). Goldman reiterates outperform.

Mercury Interactive (MERQ) posted 14 cents, vs. 21 cents fourth-quarter earnings per share (GAAP) despite a 29% revenue rise. The company sees 12 cents to 18 cents first-quarter 2004 earnings per share (GAAP).

NetFlix (NFLX) posted 7 cents fourth-quarter earnings per share, vs. a 10 cents loss (GAAP). The online video subscription company sees a $1.2 million to $3.7 million first-quarter GAAP net loss, and a $14.6 million to $21.6 million 2004 GAAP net income. NetFlix set a 2-for-1 split. The CFO will leave the company. Pacific Growth upped its estimates, and First Albany upped its price target on the shares.

Cardinal Health (CAH) posted 87 cents, vs. 82 cents second-quarter earnings per share from continuing operations on an 11% revenue rise. Cardinal reiterated the fiscal 2004 guidance of mid-teens or better earnings per share growth, before special items, and operating cash flow of about $1.3 billion. S&P reiterates buy.

Starbucks (SBUX) posted 27 cents, vs. 20 cents first-quarter earnings per share on a 28% revenue rise. Starbucks narrowed the 84 cents to 87 cents fiscal 2004 earnings per share forecast range to 86 cents to 87 cents. S&P upgraded to avoid from sell.

AT&T (T) posted fourth-quarter earnings per share of 43 cents, vs. 66 cents one year earlier, on a 13% total revenue decline. The long-distance carrier sees a 7% to 10% consolidated revenue decline in 2004.

Ford Motor (F) posted a 43-cent fourth-quarter loss per share, vs. a 7-cent loss, despite an 11% total sales and revenue rise. Ford sees 40 cents to 45 cents first-quarter earnings per share from continuing operations, and $1.20 to $1.30 earnings per share in 2004.

Computer Associates (CA) posted 4 cents third-quarter earnings per share, vs. an 8 cents loss (GAAP) on a 12% revenue rise. The company sees $845 million to $865 million in fourth-quarter revenue, and 3 cents to 5 cents earnings per share (GAAP). For fiscal 2004, Computer Associates sees $3.29 billion to $3.31 billion in revenue, and a loss per share of 5 cents to 7 cents (GAAP).

Qualcomm (QCOM) posted 43 cents, vs. 30 cents first-quarter earnings per share on a 13% revenue rise. The mobile-phone maker sees 34 cents to 37 cents total second-quarter earnings per share, and $1.41-$1.46 total fiscal 2004 earnings per share. S&P reiterates buy.

Nokia (NOK) posted 29 euro cents ($0.37), vs. 26 euro cents fourth-quarter earnings per share (pro forma) despite a 1% net sales decline. The handset maker sees 17 euro cents to 19 euro cents in first-quarter earnings per share, and a 3% to 7% net sales rise.

Drugmaker Wyeth (WYE) posted 60 cents, vs. 65 cents fourth-quarter earnings per share from operations as higher selling costs offset 14% higher worldwide net revenue (including foreign exchange).

Health Care Properties (HCP) set a 2-for-1 stock split.

Southwest Airlines (LUV) posted 8 cents, vs. 5 cents fourth-quarter earnings per share on an 8.3% total operating revenue rise.

Great Lakes REIT (GL) agreed to be acquired by Aslan Realty Partners II, L.P., an affiliate of Transwestern Investment Company. Transwestern agreed to pay no less than $4.98 per share in cash to holders of Great Lakes upon closing.

AT&T Wireless (AWE) posted a 3-cent fourth-quarter loss, vs. a 5-cent loss on 4.4% higher service revenue. The board decided to explore strategic alternatives, but says there's no assurance any transaction will occur.

BellSouth (BLS) posted 51 cents, vs. 45 cents fourth-quarter earnings per share (normalized) on a 4.1% revenue rise.


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