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Tech Industry

Circuit City browns out

Circuit City announces that sales at stores open at least a year fell 13 percent in September over last year--largely due to sluggish PC sales. Nevertheless, analysts are not predicting a dismal Christmas season.

Circuit City Stores (CC) today said sales at stores opened at least a year fell 13 percent in September over last year, largely due to sluggish PC sales.

"September's sales performance reflects a further slowdown in the home PC business and continued strength in big-screen televisions, digital satellite systems, and major appliances," said Richard Sharp, chairman and chief executive officer, in a statement. Circuit City has also found through the year that PC sales are slowing month-over-month, added Ann Collier, spokeswoman.

The news may not bode well as the company heads into the busy Christmas season, the most lucrative time for the consumer PC market.

Analysts, however, see the cloud's silver lining. Many project PC makers will see sales growth of 13 percent during the second half of the year.

"Consumer spending looks more robust now than at the end of last year," said Scott Miller, analyst at Dataquest.

Last holiday season, PC retailers fared better than earlier anticipated, according to research firm IDC, which found that 47 percent of retailers surveyed reported better than expected sales, while 36 percent said they met expectations.

Carl Ravitch, executive vice president of Audits & Surveys Worldwide said growth last December over November was only 21 percent, where as the same period the previous year had been 50 percent.

"Usually December is stronger than November and last year was an anomaly," Ravitch said. "I don't thing it will happen this year. The PC retail market year-to-date has been up roughly 10 percent. I feel the last quarter will be a good quarter," he said.