Compaq today posted fourth-quarter earnings of 19 cents per share on revenues of $10.5 billion, a decrease of 4% from the previous year but soundly beating Wall Street estimates of 16 cents per share. "During the second half of this year, we took aggressive action to return Compaq to profitable growth, and fourth-quarter results reflect our initial success," president and CEO Michael Capellas said in a statement released by Compaq after the close of financial markets today.
The Houston computer maker, struggling to achieve a turnaround after a tumultuous year in which Capellas replaced Eckhard Pfeiffer at the helm, also reported total revenues of $38.5 billion for 1999, an increase of 24% over 1998. Net income for the year was $569 million, or 34 cents per share, compared with a net loss of $2.7 billion for the previous year.
Additionally, the company made progress stanching red ink in its troubled commercial PC business, cutting the group's losses from $169 million in the third quarter to $79 million in the fourth quarter. Compaq is counting on its recent acquisition of Inacom Corp.'s build-to-order PC operations to further boost the unit. "The Inacom assets will enable Compaq to accelerate our direct programs, especially in the major-account and small- and medium-business market," Capellas said.