Compaq predicts solid first quarter

Compaq Computer expects to meet or even surpass the current financial expectations for its first fiscal quarter, helped along by several customer wins, the company announced Monday.

Compaq, in Houston, said it expects to post US$7.7 billion in revenue for its first quarter ending March 31. That would be slightly ahead of the $7.6 billion expected by financial analysts, according to a consensus estimate gathered by Thomson Financial/First Call. Compaq also said it expected to meet or slightly exceed analysts' earnings forecast of $0.01 per share.

The company's rivals have tried hard to lure away customers as its merger with Hewlett-Packard Co. hangs in limbo. Michael Capellas, Compaq's chairman and chief executive officer, said in a statement Monday that he was pleased with Compaq's ability to stay focussed in the tough climate.

The company cited customer wins in the health care, education and travel markets as the key to its financial results. Compaq is due to report its results for the period on April 18.

The news came on the heels of a rare financial warning from rival IBM Corp., which said earlier Monday that revenue for its first quarter would probably fall between $18.4 billion and $18.6 billion, compared with $21 billion in the same period last year. IBM, in Armonk, New York, also said it expected earnings per share to be in the range of $0.66 to $0.70 per share. Analysts had been expecting earnings per share of $0.85, Thomson Financial said.