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CommentsBased on the recent earnings of the tech industry’s heavyweights Intel, IBM, and Google, the worst for them may be over.
Google has reported second-profit earnings to the tune of $1.48 billion amid the gloomy global economic climate. Its shares rose from $3.92 per share last year to $4.66 per share this year. Computer giant I.B.M. also displayed a strong showing on Wall Street as it saw its second-quarter earnings rise to $3.1 billion. Chip giant Intel fared the same, with profits up to $8 billion.
Some have interpreted this display of financial strength as a signal that the worst is over for the technology industry.
Analysts predict that these companies have the advantage of reaping the financial rewards once the economy recovers. This means that Google will sell more ads, IBM more software and hardware products, and Intel more chips.
Another company predicted to gain a boost from the recovery is networking giant Cisco.
Cisco has had a subdued year, the only real news of it is the trimming down of its gigantic workforce of 66,000 by 2,000 employees. Like I.B.M. that trimmed down costs by billions, Cisco CEO John Chambers believes the cuts, not “massive layoffs” to his view, are necessary to its restructuring program.
Citi’s Richard Gardner believes Cisco is poised for more growth as the economy slowly stabilizes. “Long-term we view Cisco as a key beneficiary of rapid growth in Internet traffic,” he explains to clients.
Gardner believes the firm will play in some of the advances in technology today including the continued advance of the Internet and the spread of IP standards and cloud computing. These shifts in technology trends have slowed down because of corporate budget cuts but as soon as the economy recovers, companies will require faster networks, which is Cisco’s expertise.
Post Author: guest