TECHNOLOGY - March 21, 1996

Digital Equipment’s Stock Drops 17%: The Maynard, Mass.-based firm’s share value plunged after it warned it will not meet Wall Street’s profit expectations because of flat sales. Shares in other personal computer makers also fell. Digital had been shooting for revenue growth from PCs of 30% in the quarter that ends March 31, and analysts thought Digital would meet the predictions because it rejuvenated its PC operation in the fall. But demand for PCs has slowed, forcing manufacturers to cut prices and profits. The problem worsened last month when Compaq Computer Corp., the biggest PC maker, announced it would cut prices and accept a lower profit margin to meet its desire for 35% growth. Digital matched Compaq’s cuts immediately. Digital shares closed down $11.25 to $56 on the New York Stock Exchange. Compaq’s stock finished down $2 at $38.125. IBM closed down $4.75 to $117 and Hewlett-Packard Co. finished down $3.625 to $97.635, all on NYSE. Dell Computer Corp. was down $1.125 to $32.50 on Nasdaq.