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Tech Industry

Solectron meets expectations

Revenues increase 60 percent for the contract manufacturing company, which lately has been grabbing a substantial piece of that market.

Shares in Solectron continued a decline in after-hours trading today after the company reported second quarter earnings that matched Wall Street predictions.

Revenues increased 60.8 percent from the second quarter of fiscal 1998 to $1.91 billion for fiscal 1999. Net income for the quarter was up 34.1 percent from the second quarter of fiscal 1998 to $65.5 million for fiscal 1999.

The Palo Alto, California-based company, which provides customized manufacturing services to electronic manufacturers, saw its stock drop 1-5/16 in regular trading on the New York Stock Exchange, to a close of 48-9/16. After hours, it was trading at 47-7/8.

Solectron has been surging lately as it and other contract manufacturers take over more of the building of PCs.

Solectron, indeed, has a substantial piece of the action. From September through October 1998, the company had nearly $2 billion in sales, a huge step up over the $1.1 billion it had the same quarter in 1997.

The company is also beefing up its product and service offerings. In a recent Securities and Exchange Commission filing, the company says it not only will build motherboards, but also will design them, make prototypes, and handle returned products.

Reuters contributed to this report.