STOCKS TO WATCH: Adobe, Applied Materials, Amazon, PeopleSoft and RealNetworks

The desktop publishing software developer will be active Wednesday after it warned that slowing sales in some geographies could hurt sales and earnings this quarter.

Adobe shares, which closed at $52.75 in the regular session, plunged 16 percent to $44.31 in after-hours trading.

“The company attributes the slowdown, which is affecting all of its product segments, to weakening economic conditions, and states that the softness in the U.S. could affect its revenue outlook for the quarter,'' Adobe said in a statement. “The company is also spending cautiously to achieve its stated operating profit goals for the first quarter.”

Analysts are expecting a profit of 30 cents a share in the quarter.

Adobe previously had said it expected 25 percent revenue growth for the first quarter and the full fiscal year.

The online retailer will see heavy action Wednesday after it beat analysts’ estimates in its fourth quarter but announced it would lay off 15 percent of its work force, roughly 1,300 jobs, in effort to reach profitability by the fourth quarter of 2001.

The company also drastically trimmed back its sales forecasts for 2001, projecting that revenues would grow by 20 to 30 percent over last year to between $3.3 billion and $3.6 billion. Last year, it said sales would hit $4 billion in 2001.

In the quarter, Amazon.com lost $90.4 million, or 25 cents a share, on sales of $972 million.

Analysts were expecting a loss of 26 cents a share on sales of $994 million.

The stock closed off $1.19 to $18.94 ahead of the earnings report before falling to $18.19 in after-hours trading.

The chip-equipment maker warned after the bell that it will miss analysts’ sales estimates in its first quarter.

Applied executives said sales in the quarter will fall between 7 percent and 10 percent below its previous guidance of $2.95 billion.

It did not give any specifics as far as earnings, but did say “earnings per share are not expected to reach the target set by the company.”

First Call Corp. consensus expects Applied to earn 74 cents a share in the quarter.

Applied shares closed up $2.25 to $52.44 ahead of the warning before falling to $50.88 in after-hours trading.

PeopleSoft should move higher Wednesday after it topped analysts’ estimates in its fourth quarter, pocketing $41 million, or 13 cents a share, on sales of $498 million.

First Call Corp. consensus expected the software developer to earn 9 cents a share on sales of $498 million in the quarter.

Its shares closed off 50 cents to $48.94 ahead of the earnings report before moving up to $51 in after-hours trading.

The $498 million in sales represents a 34 percent improvement from the year-ago quarter when it earned $11 million, or 4 cents a share, on sales of $372 million.

“Our fourth-quarter financial results not only show the strong market demand for our eBusiness applications,” said Chief Executive Officer Craig Conway in a prepared release, “they also demonstrate PeopleSoft's focus on growth and profit for our shareholders.”

Company executives credited strong demand for PeopleSoft 8, the company's e-business application suite, for the strong fourth-quarter results.

Licensing sales shot up 73 percent to $165 million, up from $95 million in the year-ago period.

RealNetworks will be active after it hit analysts’ reduced profit estimates in its fourth quarter Tuesday but sales in the quarter fell below most forecasts. It also slashed its sales and earnings estimates for the first quarter and fiscal 2001.

The provider media streaming software posted a profit of $3.9 million, or 2 cents a share, on sales of $58.2 million.

First Call Corp. consensus pegged RealNetworks for a profit of 2 cents a share on sales of $60.7 million following its profit warning earlier this quarter.

Analysts originally forecast a profit of 4 cents a share in the quarter.

Its shares closed off 38 cents to $10.75 ahead of the earnings report.

During a conference call with analysts Tuesday, Chief Financial Officer Paul Bialek told analysts to expect total sales of between $240 million and $260 million in fiscal 2001, down from current consensus estimate of $297 million.

“Longer sales cycles for our systems software and weak advertising demand will have an impact on our financial results in the first quarter and in fiscal 2001,” Bialek said. “In light of the current economic environment, we’re taking a conservative stance as far as our outlook and our operating expenses.”

Bialek said RealNetworks will likely earn between 9 cents and 11 cents a share in the fiscal year, below the current estimate of 15 cents a share.

In the first quarter, it now expects sales in the neighborhood of $50 million to $52 million and earnings of around 2 cents a share. Analysts were projecting sales of $60 million and a profit of 3 cents a share.