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Tech Industry

STOCKS TO WATCH: FirstWorld Communications, IBM and Radcom

    Expect the following technology stocks to be among Thursday's most actively traded issues: FirstWorld Communications, IBM, Radcom and Visual Networks.

  • FirstWorld Communications (Nasdaq: FWIS)

    The Internet services provider figures to slide Thursday after warning that its second-quarter sales and earnings will fall short of analysts' estimates.

    Also, CEO Sheldon Ohringer announced his resignation.

    FirstWorld shares closed off 1/2 to 9 5/8 Wednesday.

    The Denver-based company said in a statement it expects second-quarter revenues to be in the range of $17.9 million to $18.2 million, compared to analyst expectations of about $19.9 million. Additionally, third- and fourth-quarter revenue will be flat-to-slightly down compared to the second-quarter of 2000, it said.

    Gross margins and earnings before interest, taxes, depreciation and amortization will be ``negatively impacted in the second quarter and the remainder of 2000,'' the company said. But FirstWorld said it expects to be funded into 2001 and had $289 million in cash and equivalents at the end of the first quarter of 2000.

    FirstWorld said Chairman Donald Sturm will serve as chief executive and president during the company's search for Ohringer's replacement.

  • IBM (NYSE: IBM)

    IBM will draw more than the usual interest Thursday in the wake of profit warnings from fellow software developers BMC Software (Nasdaq: BMCS) and Computer Associates (NYSE: CA).

    Its shares closed off 5 1/4 to 104 1/4 Wednesday.

    In conference calls, the software companies referred to anxiety over a next-generation IBM mainframe product coming later this year and the potential for a new pricing structure as possible explanations for customers' hesitation.

    IBM will report its earnings on July 19.

  • Radcom (Nasdaq: RDCM)

    Radcom should regress Thursday after it also warned that it will miss analysts' estimates in its second quarter.

    The Israeli maker of test and analysis devices for communications equipment said it will post a loss of between 8 cents to 10 cents a share in the quarter, much worse than the First Call Corp. consensus estimate of a loss of 1 cent a share.

    It now expects sales to check in around $6.6 million.

    Its shares closed off 3/8 to 6 1/16 ahead of the warning.

    The company blamed the shortfall on a delay in closing two large contracts, worth more than $1.5 million combined. Radcom expects to record that revenue in the third and fourth quarters instead.

    "We experienced longer sales cycles than expected in two orders due to their exceptional size," said Arnon Toussia-Cohen, president and CEO.

    Radcom still expects to meet its target for the full year, Toussia-Cohen said. First Call currently predicts a 2000 profit of a penny per share.

  • Visual Networks Inc. (Nasdaq: VNWK)

    The maker of software that measures the efficiency of data networks warned second-quarter earnings will be 1 cent a share, less than the average of 6 cents forecast by First Call.

    The company also expects revenue to miss estimates. Visual fell 1/2 to 26 1/4. During after-hours trading, shares were down to 25 5/8.