Intel Corp. said that it has told its customers it is pushing back the date for the volume production of its next-generation microprocessor, codenamed Merced, to mid-2000, from sometime in 1999.
The chip giant said that it underestimated the amount of time that it needs to complete all the validation and checking necessary to test the chip before it will be able to ship in volume to customers, who plan to use the chip in high-end workstations, servers and "mission critical computing" applications, Intel said.
Intel stock was trading at 70.50 in after-hours activity, after closing down 2.0625 at 71.4375.
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Robertson Stephens sold: BankBoston Corp. (BKB) today confirmed it had agreed to buy the high-tech focused investment banking firm Robertson Stephens from BankAmerica Corp. (BAC) for a total of US$800 million. BankBoston, which has been beefing up its underwriting and investment banking operations, said in a statement it would pay $400 million in cash, an additional $300 million over four years, and $100 million of stock options granted at market price. The sale is expected to close in the fourth quarter.
BankBoston had been rumored to be leading the bidding for Robertson Stephens, which put itself on the block after its parent agreed to merge with NationsBank Corp. (NB) in April. Robertson Stephens, which was bought by BankAmerica last October for $540 million, said its clients balked at the prospect of the San Francisco-based firm in effect merging with cross-town rival Montgomery Securities, which is owned by NationsBank.
Robertson Stephens, which will be renamed BancBoston Robertson Stephens Inc., will remain in San Francisco. Robertson Stephens chief executive Mike McCaffery will continue to manage the day-to-day operations and report to BankBoston Vice Chairman Paul Hogan. Robertson Stephens Chairman Sandy Robertson, 67, plans to leave and set up his own securities firm. It is unclear how many people he will take with him from Robertson Stephens, but a BankBoston spokeswoman said the bank had signed employment agreements with 90 percent, or 140, of Robertson Stephen's top managers.
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Satellite fallout: AirTouch Communications (ATI) said that last week's Galaxy IV satellite failure, which disrupted paging service nationally, will cost the company about $2 million in customer credits and overtime labor costs.
AirTouch said its paging service was disrupted for the majority of its 3.1 million customers on 19 May. By 21 May, virtually all of its customers were able to receive pages in their home markets. AirTouch Paging said it will give its customers a credit on service fees for the two-day period it was unable to provide service.
Earlier this week, magazine publisher and broadcaster Primedia Inc. said the satellite failure would reduce profits by about $5 million.
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R&D logic: Microsoft Corp. (MSFT) will spend more than $3 billion on research and development in the coming fiscal year, up from about $2.6 billion this year, CEO Bill Gates said. Microsoft spent $1.9 billion on R&D in the fiscal year that ended June 30, 1997. Gates, in a speech to executives at the company's annual "CEO summit," said the only thing that prevents the company from spending more is the difficulty of hiring qualified engineers. "That's why we've been a big proponent of relaxed immigration rules," he said.
Reuters contributed to this report.
