Hardware Sector: A Good Quarter

Lenovo: Dramatic Profits Jump
Lenovo, which took over IBMs PC range, currently develops, manufactures, and
markets PC products and value-added professional services. The company reported
strong results for its Q1, 2008, ended June 30, 2007. The consolidated revenues
for the quarter grew 13% y-o-y to $3.9 bn, driven by shipment growth in all
geographies. The companys net profit touched $67.8 mn, versus $5.21 mn a year
earlier, an increase of 1,184%. The profit came despite a $45 mn restructuring
charge recorded during the period.

Buoyed by the strong technology market, the PC shipments during
the quarter rose 22.3% to nearly 4.9 mn units, up from 4 mn during the same
period last year. Notebook shipments in the first fiscal quarter were up 26%
y-o-y, and consolidated revenue was $2.1 bn. Similarly, desktop shipments were
up 20% y-o-y posting double-digit volume and revenue gains. Consolidated revenue
was $1.7 bn in the quarter. The company has tied up with AMD to tap Chinese
rural markets. Currently the stock trades at HK$4.97.

Apple: On a High
Headquartered in Cupertino, California, Apple develops, sells, and supports
personal computers, portable media players, computer software, and computer
hardware accessories. The company posted revenue of $5.41 bn and net quarterly
profit of $818 mn for the third quarter ended June 30, 2007. These results
compare to revenue of $4.37 bn and net quarterly profit of $472 mn in the
year-ago quarter. Gross margin was 36.9%, up from 30.3% in the year-ago quarter.
International sales accounted for 40% of the quarters revenue.

New technology concepts like Apple TV, Mac OS X
"Leopard" are in the pipeline. Apple operates an online store for
hardware and software purchases and iTunes Store for digital downloadable music,
audio books, games, music videos, TV show, and movies. The company launched
Safari, the worlds fastest web browser, for windows and other OS. The Apple
iPhone has been an astounding success story with most shops running out of stock
within the first few days. Currently the stock trades at $134.08.

Cisco Systems: Acquisitions Spree
Cisco, a leading company in networking and communications segment, posted
encouraging results for the quarter ended July 2007. The net sales of the
company stood at $9.4 bn compared to $8.0 bn of Q4, 2006 a growth of 18% y-o-y.
Net profits touched $2.3 bn compared to compared to $1.9 bn of Q4, 2006 a growth
of 21.2% y-o-y for the fourth quarter result ended July 28, 2007. The recently
acquired Scientific-Atlanta, contributed $2.8 bn to net sales for fiscal 2007,
compared with $989 mn for fiscal 2006.

During the quarter the company acquired Tivella, Orative, and
Greenfield Networks. The company also announced a definitive agreement to
acquire IronPort Systems. The company and its subsidiaries got orders from major
clients like Turner Broadcasting System, Bank of America, FASTWEB, Italys
second-largest fixed telecommunications provider, Sitronics JSC, a leading
technology company in Russia. The company launched new products like iPhone a
VOIP product, Cisco Digital Signage, a solution for management, publishing and
playback of digital media on networked digital signage displays and Cisco MDS
9124 multi-layer fabric switch, designed to provide enterprise-class
capabilities such as virtual storage area networks, advanced security, high
availability, and flexibility. Currently the stock trades at $31.

Dell: Improved Performance
A, leading computer system company, specializes in servers, storage,
printing and imaging systems, workstations, notebook and desktop computers,
networking and peripheral products software, among other sectors. The second
quarter ending on August 3, 2008 saw net profit at $733 mn, up significantly
from the previous quarters US $502 mn. Total revenues rose about 7% from
$14.1 bn to $14.8 bn. Strength in enterprise products and services, improved
average selling prices and favorable component costs drove profitability in the

Notebook computers and server sales have supported sales growth
throughout the year. Revenue from servers chimed in at around $1.6 bn, up from
$1.4 bn a year ago, while notebook PC sales climbed from $3.7 bn to $3.9 bn in
the same time. Desktop computer sales, meanwhile, remained flat. About $102 mn
went to what Dell called "expired in-the-money stock options" which
includes a $48.5 mn severance payment to the fired CEO Kevin Rollins and an
additional $59 mn cost was attributed to an investigation into Dells
accounting practices. Currently the stock trades at $ 27.86.

Intel: Moderate Growth
A leader in chip segment that technologies and products around performed
moderately for the Q2, 2008 The companys revenue stood at $8.7 bn, up 8%
y-o-y and net profit was $1.3 bn, up 44% y-o-y for the Q2 ended June 30, 2007.
The Q2 gross margin was 46.9%, lower than expectations. The overall margins from
microprocessor were as expected with higher unit shipments offset by lower
average selling prices. The chipset units had record sales during the quarter
and sales of flash memory units were higher sequentially while motherboard units
were low.

During the quarter, Intel, STMicroelectronics and Francisco
Partners announced an agreement to form a new independent company by combining
Intels NOR flash memory business and STMicroelectronics NOR and NAND flash
businesses serving customers in wireless communications and other segments. The
company also launched the first-ever Core 2 Extreme processors for mobile,
enabling notebook PCs for the high-end gaming, digital art and media
applications. The company also announced its new investment in a Vietnam
facility that will be the largest single factory within the Intel assembly and
test network. Currently the stock trades at $25.09.

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