Profit Plunges 56% at Compaq

Compaq Computer Corp. reported a 56% drop in fourth-quarter profit to $332 million, or 19 cents a share, dragged down by lower sales of business computers as the company struggled to maintain its global leadership in personal computers.

But the results exceeded the 16-cents-a-share average of analyst forecasts from First Call/Thomson Financial. The estimates ranged from 8 cents to 22 cents.

Compaq’s sales fell 3.5% to $10.5 billion, even as consumer PC sales jumped 24% to a record $2 billion.

While Compaq leads in worldwide sales of PCs, Dell Computer Corp. overtook Compaq as the No. 1 U.S. PC company during the quarter, underscoring the company’s uphill battle against stiff competition and mismanagement.

CEO Michael Capellas said analysts’ estimates for the Houston-based company to earn $1.08 a share this year are on target. Compaq released its results after regular trading on the New York Stock Exchange, where it closed off $2 at $31.

At a Glance

* BMC Software Inc. said its fiscal third-quarter earnings fell 7% to $105.3 million, or 41 cents a share, citing slower sales in North America during December. Revenue rose 24% to $426 million.

* EBay Inc. said profit climbed 85% to $6.1 million, or 4 cents a share, in the fourth quarter, excluding one-time items, as the number of bidders and sellers quadrupled at its Web site. EBay’s results exceeded the average analyst estimate of 2 cents and “whisper” expectations of as high as 3 cents. Sales more than doubled to $73.9 million from $30.9 million.

* Western Digital Corp. reported a net loss of $15.2 million, or 13 cents a share, for its fiscal second quarter, much less than the $82.3 million, or 93 cents a share, it lost a year ago. But without restructuring charges and a one-time gain, the company lost $66 million, or 54 cents a share. Analysts had expected a loss of more than $100 million, excluding charges and gains. Revenue fell 24% to $560.2 million.