Tandem posts drop of 72% in net income; executive shakeup at computer maker

Article Abstract:

Tandem Computers' net income for 4th qtr FY 1995 dropped to $19.8 million based on revenues of $640 million, a 72.1% plunge from FY 1994's 4th qtr net income of $71 million, prompting Pres and CEO James G. Treybig to step down. Treybig will become chairman as soon as a replacement for the CEO position can be found, and Chmn Thomas J. Perkins will vacate that post in order to serve as chairman of the executive committee. COO Robert Marshall and a gen mgr, Donald Fowler, plan to leave by the end of 1995. Analysts approve of the employee changes, praising Treybig for his instincts in determining the future of technological developments, but noting that he is less effective in company operations. Tandem plans a new business unit for its Server Net products and will spin-off subsidiary UB Networks as a data communications company. For FY 1995, the company saw income fall to $107.5 million, a 36.8% drop.

Management, Reorganization and restructuring, Company Employee, Company Employee Status Change, Company Restructuring/Company Reorganization

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Apple Computer earnings fell 47.6% in latest period

Article Abstract:

Apple's 4th qtr FY 1995 earnings dropped 47.6%, but Apple shares fell only moderately in response to a perception that Apple has overcome the worst. Although CEO Michael H. Spindler called 4th qtr FY 1995 the most difficult the company has faced, revenues increased 20% and 1.25 million units shipped, a 25% increase over 1994 figures. Net income for the quarter reached $60.1 million, equalling 48 cents a share, in comparison with $114.7 million in 4th qtr FY 1994. Analysts had anticipated income of 52 cents a share. Revenues increased from $2.5 billion to $3 billion. Apple's FY 1995 net income reached $424.2 million, up 36.8%, and the year's revenues totaled $11.1 billion, up 20.4%. The company's reduced operating income is the result of lower gross margins as a percent of sales. In 4th qtr FY 1995, gross margins contributed only 20.7% of net sales, while in 4th qtr FY 1994 they accounted for 27.2%.

Finance, AAPL, Company sales and earnings, Apple Inc., Company Financial Information, Company Sales/Revenue, Company Earnings/Profit

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Compaq to acquire Tandem, big-systems maker

Article Abstract:

Compaq is acquiring Tandem Computer in a stock deal worth approximately $3 billion. News of the acquisition prompted Tandem's stock to jump 38% to $20.75, up $5.75. Shares of Compaq stock dropped $2.875, to $103.875 and the company announced its share buyback program was going to end. Compaq is attempting to move out of its position as the world's largest PC maker and become the third largest computer systems maker in the world. This acquisition will move Compaq further out of the reach of rivals such as Dell and Gateway 2000 and into competition with HP and IBM. Tandem will become a wholly owned subsidiary of Compaq and its CEO, Roel Pieper, will continue to hold his position as CEO of the company and become a Compaq executive vice president.

Mergers, acquisitions and divestments, Compaq Computer Corp., CPQ, Company Acquisition/Merger

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