Taiwan Semiconductor Manufacturing and Taiwan-based, United Microelectronics, two of the world's largest manufacturers, said on Monday they expect this year's profits to be well below half of last year's earnings after a semiconductor boom went bust in late 2000.
Analysts said TSMC's forecast was roughly in line with market expectations after it announced on Friday that first quarter profits slipped 16 percent against last year and warned that sales would tumble 26 percent in the April to June period from the previous three months.
However, United Microelectronic's weak 2001 forecast surprised most analysts, after the company's January to March net profits of TW$6.47 billion, also announced on Monday.
"These two companies are sending out very mixed signals to the market," said Chris Hsieh, semiconductor analyst for ING Barings in Taipei.
- - -
Disputing accusations: Computer Associates International is defending its business and accounting practices in response to Sunday's article in The New York Times that said the enterprise software maker has systematically overstated its revenues.
Chief Executive Sanjay Kumar told analysts in a conference call that a new business model allowing Computer Associates to account for revenues by short-term subscriptions instead of one-time license fees will not only benefit the company and customers, but has been copied by competitors.
During the conference call, Computer Associates disputed all accusations in the article and criticized the Times reporter for not speaking to the company.
Ira Zar, Computer Associates' chief financial officer, said he was not aware of any investigation by the Securities and Exchange Commission or any other regulatory body regarding the company's accounting practices.
- - -
Deal du jour: Germany's biggest microchip maker Infineon Technologies said it is buying Catamaran Communications for $250 million in stock.
Catamaran, based in San Jose, California, makes integrated circuits for the optical networking market.
- - -
Another deal du jour: In a move to bolster its gene family-based drug discovery effort, Vertex Pharmaceuticals has agreed to buy Aurora Biosciences for about $592 million.
The companies said in a press release that the stock-for-stock deal, which has been approved by the boards of directors of both firms, calls for Aurora shares to be converted into newly issued Vertex common stock shares at a fixed ratio of 0.62 shares of Vertex common stock for each share of Aurora common stock.
- - -
Possible deal du jour: NTL, Britain's biggest cable operator, said it was in early stage talks with AOL-Time Warner about a possible partnership in Europe.
"It is true that we are in the early stage of talks with AOL about some potential joint activity, (but) apart from an outline term sheet (agenda), nothing has been agreed at this stage, and we have nothing to announce," an NTL spokesman said.
- - -
New appointment at Ariba: U.S. Internet commerce software maker Ariba said it named President and Chief Operating Officer Larry Mueller as chief executive.
The company said in a statement that Mueller, 48, replaced Keith Krach in the post. Krach will remain chairman.
- - -
Job cuts at Excite: Excite@Home will cut 13 percent of its staff, or 380 workers, a company spokeswoman said. This marks the second round of layoffs at the high-speed Internet service provider and media company.
The layoffs come as the company struggles to cut costs and offset the drain created by its Excite.com site and other media assets amid the sharp decline in advertising spending.
The spokeswoman said the cuts would be across the board, but the media business would be hit by the reduction a bit more than the rest of the company's operations.
Reuters and AP contributed to this report
