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In Reply to: RE: Been keeping my head in the sand, but now it's time to reach out for help! posted by AbeCollins on January 11, 2017 at 20:07:02
Go read up, Abe. Toshiba have their dicks in the wringer due to FRAUD and bad management decisions. That sets them apart from the others, at least the fraud part. And IBM did not sell their PC biz because they needed the cash. They sold it to Lenovo because they understood that it was going to be a low margin, no-growth market from that point forward. IBM is like every other used-to-be hardware company struggling to be a services company. And how do you know Dell is doing well? They're a private company and provide zero financials. In fact, their sale of Perot systems suggests to me that all aint exactly rosy with them.
Follow Ups:
I don't think it's very rosy for many hardware companies but AAPL seems to be doing fine..... hugely better than most.
I haven't followed Toshiba lately so I'm not aware of recent fraud. I know that way back in the 1980's Toshiba of Japan and a company from Norway were caught exporting machinery to the Soviets that allowed them to manufacture quieter submarine propellers. It was a huge scandal.
Yup, IBM has been divesting itself of commodity hardware for quite a long time now. They've sold off disk drives, PCs, x86 servers, and microelectronics. They paid GlobalFoundries $1.5B to take over their semiconductor fab. I believe there has been a slight uptick in their proprietary POWER Series server sales using the POWER microprocessor (now manufactured by GlobalFoundries). Yet overall revenue has declined for 17 straight quarters now as they try to reinvent themselves. Maybe they'll figure a way to capitalize on Watson. ;-)
We know that Dell does not file a 10-K with the SEC but numerous articles hint at Dell doing much better since going private. Dell's ranking among tech journals have climbed for products and customer support. But like many others, they are still a company racing to the bottom of the barrel of cheap low margin commodity PC hardware.
Abe,
Yeah, a year ago Toshi got caught cooking their books. They'd shown a profit in the PC division for 7 years running whereas in truth it lost money. They used accounting slight of hand to generate the profits. They came within a whisker of execs facing criminal charges in Japan, but prosecutors felt the case would be too difficult to prove. All senior management resigned. In 2013 I think it was, they bought the nuclear reactor business from Westinghouse for several billions. Virtually every one of their reactor jobs across the globe are now either way behind schedule or way over-budget, or both (thus the desperation for cash). Furthermore, as a fallout of the accounting scandal, it's been determined that their nuke bidness is not worth anywhere near the asset value they've been carrying it on their books (Westinghouse purchase) so they are being forced to mark to market and are in process of writing off billions and billions. Stock price dropped in half over night on the exchanges - that was around Xmas time. Then, if that weren't bad enough ... new evidence of additional/further accounting cheating came to light right after the new year and there is renewed talk of criminal charges in Japan and they have been threatened with de-listing from the Tokyo exchange (further 10% drop in share price). As for Dell, they probably are doing better, but then without audited financials its impossible to know. Dell/EMC are my companies larget client in North America and I know a lot of people in both companies and word is that they are much stronger now. What we can say for sure is that they are doing well enough for their investors to loan them the money to buy EMC. There were many that thought Toshi should've been barred from doing biz in the US after they gave the Ruskies our submarine technology back in the '80's. Sad what's become of them.
BTW, I've spent the last 35 years in the business end of the info tech business with one of those used-to-be hardware companies who are likewise struggling to reinvent themselves (not IBM). With an entire career where IBM was the enemy, I now find myself in sympathy with them as they are facing what my company has faced, and it aint easy or pretty.
Best,
Mike
Thanks for the details on Tosh. We used to buy Tecra laptops years ago because we could count on the laptop hardware remaining very compatible and consistent over several product generations. We ran another OS on them in addition to Windows so we tried to avoid rapid changes to the underlying hardware platform. Sad that Tosh is where it's at today.
I like to take stabs at IBM but I too came from a couple hardware companies that went thru their highs and lows (SGI & Sun). I'm at a more diversified company now that continues to invest in microprocessor, servers, storage, systems, OS, middleware, database, and applications. But I admit that the hardware side is a constant struggle.
I work in the field and I follow some of these companies casually as my competitors. It will be interesting to see how the Dell/EMC/(VMware) thing works out. I haven't followed HPE lately but I believe their stock price shot up significantly last year.... but so did the broader market. I have personally displaced a good amount of NTAP in my accounts. And we're seeing more from Cisco (not just switches).
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