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Stock Analyst Update

Expect a Mixed Bag of Earnings from PC Makers This Quarter

The lingering aftermath of Y2K may have taken its toll on the industry.

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Personal-computer makers are likely to deliver a mixed bag of earnings results over the next few weeks. Demand is still very strong in the industry, and the average selling prices of PCs have largely remained stable over the past several months. Despite the strength in pricing and demand, however, some computer makers still found themselves constrained by the aftermath of Y2K.

Seasonality Means Less Growth Isn't Bad
The holiday season is a tough act to follow. Most PC makers do a larger-than-usual percentage of their business in December. Growth in the quarter after the holiday season, then, can look flat or even negative when compared with the quarter that includes the holidays. That's why it is best to compare a quarter's sales against those from the year-ago quarter.

Jeremy Lopez does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.