Compaq Computer Corp. today for the first time since last year's takeover of Digital Equipment Corp. reported year-on-year increases in both net income and revenues for its fourth fiscal quarter, ended Dec. 31, 1998.
The Houston-based computer vendor reported after-tax profit of US$758 million, or 43 cents per diluted share on revenues of $10.86 billion, compared with $667 million, 42 cents per share and $7.32 billion, respectively, in the corresponding quarter in 1997.
Following several quarters of losses and lower year-on-year earnings, the record results are a "key milestone" in Compaq's integration of Digital, and allow the company to enter 1999 with a "great deal of momentum and optimism," said Eckhard Pfeiffer, Compaq's president and chief executive offer, in a statement.
Compaq completed the Digital merger, valued at $9.6 billion, in June of 1998.
For the full year, however, mainly due to charges related to the Digital acquisition, Compaq reported a net loss of $2.74 billion, or $1.71 per diluted share, on revenues of $31.17 billion. In 1997, Compaq turned in a net profit figure of $1.86 billion on revenues of $24.58 billion.
On the upside, operating expenses, which had been high as a result of integrating the two companies, finally declined in the fourth quarter, to 18 percent of revenues, compared with 23 percent for the immediately prior quarter, the company said.
In addition, Compaq's sales through its distribution channels grew 43 percent year on year during the last quarter, a rate which the company said was over three times higher than the overall market.
More financial information on Compaq is available at http://www.compaq.com/corporate/ir.
Compaq, in Houston, Texas, can be reached at +1-281-370-0670 or at http://www.compaq.com/.