The technology sector's slack financial performance continued last week as several companies posted increased losses.
For the quarter ended Jan. 27, VA Linux Systems doubled its revenue to $42.5 million, up from $20.1 million in the year-ago quarter. However, the Linux vendor's revenue gain was eclipsed by a big loss during the quarter. VA Linux reported a loss of $74.1 million, or $1.57 per share, compared with a loss of $11.5 million, or 50 cents per share, last year. Even on a pro forma basis, excluding various charges, VA Linux missed analysts' expectations. The company posted a loss of 28 cents per share, while First Call projected a loss of 26 cents per share. The earnings announcement sent VA Linux's stock price tumbling 22 percent the next day. Its stock closed at $5.38 per share on Feb. 22.
Larry Augustin, VA Linux's CEO, told investors the company plans to lay off 25 percent of its 556-person workforce to help it reach profitability at lower revenue levels. VA Linux also named Ali Jenab president and COO.
Internet Capital Group, a new economy holding company that owns a 30 percent stake in Breakaway Solutions and a 17 percent stake in Jamcracker, also reported increased losses.
For the quarter ended Dec. 31, Internet Capital Group posted a loss of $561 million, or $1.97 per share, on revenue of $21.2 million. In the year-ago quarter, the company reported a loss of $23 million, or 9 cents per share, on revenue of $1.7 million.
On a pro forma basis, Internet Capital Group reported a loss of $200 million, or 70 cents per share, vs. a year-ago quarter loss of $30 million, or 12 cents per share.
Agilent Technologies, the equipment-testing spin-off of Hewlett-Packard, was among the few companies to report a profit. Including charges, Agilent posted earnings of $154 million, or 33 cents per share, on sales of $2.8 billion in the first quarter ended Jan. 31.
Though Agilent showed growth from the year-ago quarter when earnings were $131 million, or 30 cents per share, CEO Ned Barnholt warned that this year's second quarter would be rough. Pro forma earnings in the first quarter were $237 million, or 51 cents per share, vs. $143 million, or 31 cents per share, in the year-ago quarter. Agilent projects revenue growth of 10 percent to 15 percent for the current fiscal year.