STOCKS TO WATCH: Crossroads Systems, Intuit, Novell and VA Linux

Crossroads Systems should gain ground Wednesday after it posted a smaller-than-expected loss in its second quarter, losing $639,000, or 2 cents a share, on sales of $11.1 million.

First Call Corp. consensus expected the maker of fibre channel storage routers to lose 3 cents a share in the quarter.

Its shares closed off 9, or 15 percent, to 50 7/8.

The $11.1 million in sales represents a 217 percent increase from the year-ago quarter when it lost $904,000, or 14 cents a share, on sales of $3.5 million.

Including a variety of one-time and amortization charges, Crossroads posted a loss of $21.6 million, or 83 cents a share, in the quarter.

The maker of chips for communications equipment agreed to acquire Sierra Imaging Inc. for about $43.6 million in stock to add components for digital cameras to its line-up.

Conexant shares fell 1 1/4 to 34 7/8 at Tuesday's close.

Intuit easily topped Street estimates in its third quarter Tuesday, raking in $76.3 million, or 36 cents a share, on sales of $329.1 million.

Analysts were looking for a profit of 33 cents a share this time around.

Its shares closed off 1 1/4 to 27 1/16.

The $329.1 million in sales marks a 26 percent improvement from the year-ago quarter when Intuit earned $50 million, or 24 cents a share, on sales of $261.5 million.

In the quarter, Intuit's Internet sales jumped to $117 million, roughly 35 percent of the company's total sales in the quarter, and up more than 100 percent from the same period last year. Through the first three quarters of the year, it has posted more than $242 million in online sales.

International sales soared up 67 percent from the third quarter of last year, mainly due to growth in small business accounting software sales in Japan and a strong tax season in Canada.

It's hard to read which way Novell shares will go Wednesday after it managed to slip past analysts' reduced estimates in its second quarter Tuesday but saw its year-over-year sales fall 4 percent.

It posted a profit of $31 million, or 9 cents a share, on sales of $302 million, including a one-time $35 million royalty from Caldera Inc.

Exluding the one-time gain, Novel posted a profit of 2 cents a share, a penny better than the First Call Corp. consensus estimate.

Its shares closed up 13/16 to 9 3/4 ahead of the earnings report.

Earlier this quarter, Novell braced investors for Tuesday's disappointing news, blaming a combination of Windows 2000, Linux-based products and management and organizational issues for lackluster sales.

It announced a restructuring plan aimed at providing better service for small and large businesses and ramping up its indirect channel sales.

VA Linux should take off Wednesday after posting a smaller-than-expected loss in its third quarter.

The maker of servers running the Linux operating system reported a fiscal third quarter net loss of $4.5 million, or 13 cents a share, excluding non-cash items. First Call's survey of four analysts predicted a loss of 23 cents a share.

Including pre-tax charges of $10.2 million in amortization related to stock options, $1.9 million in goodwill writedowns and $4 million to write-off acquired in-process R&D, VA Linux lost $20.6 million, or 58 cents per share.

Third quarter revenue increased to $34.6 million, up 710 percent year-over-year and up 71 percent sequentially. Revenue was also well above analysts' expectations. Gross margins rose to 17.8 percent from 14 percent in the third quarter.