COMMENTARY -- A Tech Industry Memo to Wall Street:
Please don't kill us. Not all of us are hurting.
We at Hewlett-Packard (NYSE: HWP) aren't exposed like some of our more PC-oriented peers. Those of us with Novellus (Nasdaq: NVLS) are confident we'll make our number. At Cirrus Logic (Nasdaq: CRUS), we remain on track to hit our forecast. The gang here at Atmel (Nasdaq: ATML) feels fine. On the distribution end in our Arrow Electronics (NYSE: ARW) front, nothing has changed.
Despite that, you investors, you traders, you jittery Wall Street types -- you've all combined to pummel us lately.
The Nasdaq Composite Index lost more than 300 points over the first four days of this week, even though everyone knows your beloved Republican administration is about to take over.
Remember that despite what many ZDNet readers seem to think, the PC is not the be-all and end-all of the technology industry. No sir, we've also got servers, wireless phones, routers, switches, audio devices, digital cameras, printers, smart cards, fiber optic boosters, network adapters, digital signal processors. To name a few.
Sure, there's nervousness about some of those product sales also. But all told, it remains strong. Companies are still expanding their Internet presences, communications carriers keep building out their fiber optic loops.
Furthermore, next year things are expected to pick up again. Once the weaker players (Read: pure dot-coms) are gone, the real companies can be expected to do extremely well.
That's because the Internet is not a fad. If it were, you wouldn't be reading this right now.
Almost all of the bad news -- assuming lower PC prices and prudent purchases of network equipment are bad, which they're not -- can be confined to specific companies. Compaq Computer (NYSE: CPQ) hasn't complained about the quarter. Not a peep from Applied Materials (Nasdaq: AMAT). No worries expressed yet by the Micron Technology (NYSE: MU) memory chip business (as opposed to the MUEI computer company, which has been an unfortunate case for a long time). Sun Microsystems (Nasdaq: SUNW) hasn't complained.
Those are bellwether companies to varying degrees. None of them have talked the numbers down.
And in the new world of Regulation FD, companies are almost obligated to put out the word if things look bad. A few months ago, you could dial up the analysts and quietly bring their estimates down; now you have to issue a press release.
Thus, a lack of news in an FD world suggests positive results. We're more than halfway through the quarter, and most tech stalwarts are saying nothing. Never before has silence sounded so golden.
Yet you guys whipped us because Gateway (NYSE: GTW) cried about the economy.
Give us a break. We didn't force Gateway into its business model. We're not the ones who told the company to increase its already-heavy reliance on consumer PCs in the same year that Greenspan decided to push a bunch of interest rate hikes.
Not that we think Gateway is a bad business, mind you. But the Cow's problems are largely the result of its consumer PC focus. It has nothing to do with many of us. Most of us don't supply parts to Gateway, and the ones who are Gateway suppliers also serve many other companies.
Speaking of suppliers, don't lump us all in with Altera (Nasdaq: ALTR), whose warning fueled defections from every stock remotely related to semiconductor manufacturing.
Telecom companies beefed up months ago, something that plenty of observers pointed out months ago. Altera chose not to notice, but that doesn't mean everyone else missed the boat too.
So this week, while you Wall Streeters flogged the tech sector, we took the time to remind you that not everyone has problems.
As we survey our stocks on this final trading day of the week, we see that you are finally responding to the collective weight of our optimism -- the Nasdaq was up more than 98 points just before the halfway mark of today's session.
Bless you on this Friday for shedding your mantle of despair. Don't put it on again.
The Rest of the Tech Industry. 22GO>