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Behind the Compaq curtain

The PC giant must face market conflicts that could affect the company in the long run: slowing demand and lower prices.

Although Compaq Computer surpassed analysts' expectations with a slight quarterly gain, it still must face market conflicts that could affect the company in the long run: slowing demand and lower prices for PCs.

Earnings mask deeper woes
news analysis Digital revenues are included in the numbers, even as demand slows and consumers remain interested in lower-priced machines.

Slight gain reported
update The PC giant posts a second-quarter profit of $32 million, or 2 cents a share, slightly better than Wall Street expectations.

Second-half growth expected
In the just-completed quarter, the company aimed to deplete inventory and also account for the cost of Digital Equipment, but growth will follow.

Compaq cuts notebook prices
update The PC maker reduces prices on a range of Armada notebooks by as much as 26 percent in an effort to move older models.

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