5 Companies That Dropped The Ball This Week10:00 AM EST Fri. Apr. 26, 2013
Six months after Microsoft released its Windows 8 operating system, which ushered the software giant into the era of touch-screen navigation, its partners and customers are avoiding upgrading to it because of the amount of training involved in learning the new user interface.
"Our customers are saying they're nervous about Windows 8 because of the training requirement that's going to go with it, to make that leap from that typical interface that they're used to with the Start button," said Phil Fortmeyer, partner at Clear North Technologies, a Plymouth, Minn.-based solution provider. "We've certainly seen a slump in PC sales. And I'd say it's been a small percentage going with Windows 8. The majority still want to do Windows 7."
Apple reported $9.5 billion in profit for its fiscal second quarter, but as gaudy as that figure looks on paper, it represents an 18 percent decline year-over-year. This was the first time Apple's quarterly profit dropped since 2003, and now it looks like Apple's revenue for the current quarter could follow suit. Apple says it's expecting revenue of $33.5 billion to $35.5 billion, compared with the $34.96 billion it raked in during the same quarter last year.
Huawei Deputy Chairman Eric Xu, speaking at a conference in Shenzhen, China, earlier this week, said Huawei is "not interested in the U.S. market anymore," as reported by Reuters. Xu also said Huawei had cut its U.S. enterprise sales target for 2017 from $15 billion to $10 billion, fueling the impression that the China-based vendor was fed up with U.S. government scrutiny of its business and was taking its ball and going home.
Turns out that wasn't the case. Francis Hopkins, director of corporate communications for Huawei's U.S. headquarters in Plano, Texas, told CRN later that Xu was referring to Huawei's U.S carrier network business. Huawei, he told CRN, is still planning to build its enterprise business in the U.S. and plans to hold its first-ever partner conference under its own brand next month.
VMware's profit during its fiscal first quarter dipped 9 percent, and the vendor alarmed Wall Street by cutting its revenue forecast for its current quarter and full fiscal year. In its second quarter, VMware is now expecting revenue of $1.21 billion to $1.24 billion. Wall Street analysts had been expecting $1.26 billion. VMware in January forecast fiscal 2013 revenue of $5.23 billion to $5.35 billion, but is now expecting $5.12 billion to $5.24 billion.
VMware CFO Jonathan Chadwick said the revised guidance is partially due to the removal of $110 million in revenue from VMware's Pivotal Initiative joint venture with EMC.
Avnet had a rough ride in its fiscal third quarter, with profit plummeting 41 percent and earnings per share dropping 12.6 percent. The Phoenix-based distributor is planning to make $40 million in cuts by the end of its fiscal third quarter to compensate for the weakness, which CEO Rick Hamada attributed to the "organic revenue declines in the higher-margin Western regions" that have plagued Avnet for the past five quarters.
When Avnet's earlier planned cost reductions are factored in, the company now expects to slash around $140 million this year.