Just a quick post on news that came over the wire late UK time.
Dell saw their share price drop by 17% today on weak quarterly figures, as reported by Forbes, with seemingly significant drops in their consumer business. Could this partly be the Apple effect? Dell are working hard at building their storage business although there’s still a way to go in what is an evolving story.
HP have announced they are laying off 27,000 jobs – 8% of the workforce – as they restructure (BBC News article). This isn’t a surprise as the cuts were pre-announced, but perhaps the scale of the cuts was much higher than expected. I know quite a few HP’ers and hopefully they will be safe this time around. HP are suffering the aftermath of poor decision making and the Leo effect. It’s notable that the BBC also reported Mike Lynch (Autonomy founder) is to be replaced within HP.
Netapp saw it’s share price dive by over 17% in after-hours trading, despite publishing good results. More on the story at MarketWatch. Netapp need to diversify; something I’ve mentioned on many occasions before if they are to grow as the market demands.
The Architect’s Take
Even though tech seems to be booming, the markets demand significant improvement in profits with every quarter. One set of weak results or forecasts deals a swift blow to the share price. Picking the right tech stock doesn’t get any easier – neither does running these businesses.