Compaq plans to introduce line of low-cost machines

Article Abstract:

Compaq is introducing several new microcomputers and a new line of notebook computers at low prices in an effort to regain market share. The company has been losing sales to manufacturers that sell low-cost computer products. The Compaq Prolinea is a line of new microcomputers that costs under $1,000 and uses Intel 80386 and 80486 microprocessors. The Compaq Contura is the new notebook computer. Compaq also plans to cut the prices on existing computer lines. Industry analysts expect IBM to wait until the summer of 1992 before it cuts existing prices and introduces its own low-line inexpensive products. Compaq's 1st qtr 1992 revenues were $783 million, down 19.2 percent from $970 million in 1st qtr 1991. Some analysts believe that consumers are not buying Compaq products because they know the company will release new inexpensive models shortly, which should result in even lower earnings for 2nd qtr 1992.

Computer industry, Product introduction, Compaq Computer Corp., CPQ, Product Announcement, Laptop computers, Portable computers, Price cutting, Laptop/Portable Computer, Compaq ProLinea (Intel-compatible system), Compaq Contura (486-based notebook)

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Apple pays price for new strategy

Article Abstract:

Industry observers note that investors are not pleased with Apple Computer Inc for its long-term strategy even though the computer maker's short-term strategy of capturing more market share is working. Apple decided to capture a larger share of the microcomputer market share by selling its popular Apple Macintosh microcomputers at lower cost. The strategy has been successful but investors are sending the stock prices down because they feel that Apple will not be able to return to the profitability it has historically known. Apple will have to cut costs and gain a greater market share of the computer industry to regain high profitability. Apple's stock fell $7.75 a share in one day in May 1991 and closed at $47.25 a share; the stock's high price in the previous year is $72 a share.

Computers, peripherals & software, Computer software industry, Software industry, Marketing, AAPL, Apple Inc., column, Strategic Planning, Low Cost, Stock

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