Mighty Microsoft turns for the worse and Sprint falls foul of the law

The Financial Times today brings news that mighty Microsoft has downsized its profit forecast for 2001, while rival Oracle reported better-than-expected second quarter results.

The software giant blamed a slow global economy for a downturn in both software sales and online advertising. Wall Street analysts had hoped to see earnings of around 49 cents a share. Reviewed revenues forecasts predict a more likely result to be five or six per cent below that at 46 or 47 cents. Subsequent after-hours trading saw Microsoft shares slip eight per cent to $52.50, significantly below a year high of almost $120 in late December 1999... Oracle, second biggest software company in the world behind Microsoft, reported earnings one per cent above analyst predictions and said it expects accelerated global software sales in coming months... Siemens, too, has come in confident for the future. According to the FT, the German electronics and engineering group said it is expecting both sales growth and earnings to be in double figures for 2001. The company claims this to be a result of continuing efforts to increase profitability. It is investigating "creative ways" to reduce its 71 per cent stake in chipmaking subsidiary Infineon and has confirmed plans for a non-diluting one-for-two stock split. The company is considering allowing shareholders to exchange stock for shares in Infineon. The announcement prompted a fall in shares of both Siemens and Infineon... The Guardian tells of US telecoms company Sprint running foul of the law. A shareholder has filed suit against the firm, alleging managers revised the change of control clause secretly, illicitly earning themselves hundreds of millions of US dollars. 22 senior executives were able to cash in share options despite a proposed $115bn merge with Worldcom falling foul of US regulators in July. Ordinarily, share options reward long-term performance and can be activated only after a deal goes through. Sprint executives are alleged to have changed the clause in order that options became live once shareholders approved the merger and cashing in soon after. The accused include industry heavyweights Bernard Ebbers, head of Worldcom, William Esrey, chief of Sprint, and board members including Deutsche Telekom's Ron Sommer...