Intel Slips, Boeing Dawdles
Intel sees a 51 percent jump in profits, and a 14 percent slump in its stock price. Boeing delays its 787 Dreamliner
EWS AT A GLANCE
Intel misses the target
Intel reported a 51 percent jump in fourth quarter profits, to $2.27 billion, but the gain fell short of analysts’ expectations, sending Intel shares down almost 15 percent in extended trading. Intel’s guidance for the next quarter also fell slightly shy of analysts’ forecasts. (MarketWatch) With investors worried about the economy, “I don’t think anybody is going to stick their neck out and put out guidance that they just don’t feel rock solid about,” said Pat Becker Jr. at Becker Capital Management in Portland, Ore. Intel is the first U.S. tech company to report quarterly earnings. (Bloomberg)
Boeing faces another Dreamliner delay
Boeing will delay the maiden flight of its 787 Dreamliner for a second time, from late March to June, according to news reports. That means Boeing won’t deliver the first 787 to Japan’s All Nippon Airways in late 2008, as planned. (The Wall Street Journal) Boeing has sold 817 of the planes so far for more than $100 billion, and the further delays will be a blow to airlines eager to expand their fleet. But with rival Airbus’s similar A350 still five years away, “where are they going to defect to,” said CreditSights analyst Brian Studioso. (The New York Times, free registration) Boeing delivered 441 commercial aircraft last year, versus Airbus’s 453, but it took orders for 1,413 planes, beating Airbus by 72 orders. (Bloomberg)
IndyMac lays off 24 percent of workforce
U.S. mortgage lender IndyMac Bancorp said it is cutting 2,403 jobs, or about a quarter of its workforce, to help it weather the deteriorating housing market. IndyMac cut 1,600 jobs last year, and CEO Mike Perry said there will probably be another 500 to 1,000 cuts in the next six months. (Los Angeles Times, free registration) The cuts will significantly reduce IndyMac’s sales staff, mainly affecting employees in India. (AP in The New York Times) Perry said IndyMac has a “realistic shot” of returning to profitability in the second half of 2008. IndyMac shares have fallen 89 percent in the last year. (Reuters)
The strike begins in earnest
The TV networks are finally out of fresh sitcoms and dramas, after 10 weeks of the writers’ strike. Some of the reality shows that have come on as replacements are actually drawing more viewers than the shows they replaced, due in part to less competition, but more repeats and the end of football season are expected to take a toll on the networks. Fox should do better than the others, due to its American Idol franchise, and NBC won’t be hurt as badly “because they have lower-rated shows to begin with,” says Magna Global USA analyst Steve Sternberg. But all networks will suffer, he adds: “New reality shows are not doing better than scripted hits.” (USA Today)
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