Business Highlights

Posted: Thursday, July 12, 2001

SAN JOSE, Calif. (AP) -- Second-quarter earnings at Yahoo! Inc. edged past Wall Street expectations Wednesday, though the Internet giant said its results in the current quarter could fall slightly below current estimates.

Proving that the Internet economy remains deep in the doldrums, Yahoo showed a net loss of $48.5 million, or 9 cents per share, in the three-month period ending June 30, compared to a profit of $53.3 million, or 9 cents per share, a year ago.

Excluding restructuring charges and other one-time items, Yahoo earned $8.7 million, or 1 cent a share. Analysts surveyed by Thomson Financial/First Call were predicting break-even per-share results.

Revenue slipped 33 percent, to $182.2 million from $273.0 million last year, though was still better than the $175.1 million Wall Street expected.


SEATTLE (AP) -- Microsoft Corp., responding to a recent court ruling that said its competitive practices broke the law, will change its licensing agreements with computer manufacturers, allowing them to remove shortcuts to Microsoft's Internet Explorer browser from the Windows computer desktop.

The company also announced Wednesday that PC manufacturers will be able continue to add icons of other technology companies, such as RealNetworks Inc. or AOL Time Warner Inc., on the forthcoming version of Windows, called XP.

Previously, the company had sought to create a completely clean desktop for the new system, due out Oct. 25, free of both Microsoft and competitors' icons. In light of the ruling, that plan would have been illegal, because it prohibited manufacturers from adding shortcuts to competing products.


BOSTON (AP) -- Polaroid Corp. said Wednesday it would explore a merger or sale and said it received a reprieve from lenders, as the the camera and film maker tries to dig out from beneath a mountain of debt.

The company announced a waiver, good through Oct. 12, on a $363 million line of credit that was set to expire Thursday, but said it would miss payments to bond holders next month. It now faces negotiations with bondholders to restructure that debt.

The company also has retained advisers to explore several options for the future of the company, including ''a sale of assets, a merger or sale of the company, and/or a strategic partnership,'' said Polaroid spokesman Skip Colcord.

Pending the announcement, Polaroid shares were suspended near the end of trading Wednesday on the New York Stock Exchange.


CHICAGO (AP) -- Motorola Inc. posted a whopping loss for a second straight quarter amid a deep slump in the cell phone and semiconductor industries, but narrowly beat Wall Street's reduced expectations.

Despite the latest signs of deterioration in its main businesses, Motorola's shares rose sharply in extended trading after the report, which said the company's broad restructuring has begun to bring improvements in orders and new products.

The net loss for the second quarter was $759 million, or 35 cents a share, compared with earnings of $204 million, or 9 cents a share, for the same period in 2000.

Excluding acquisition expenses and other one-time items, Motorola lost $232 million, or 11 cents a share, for the quarter. That compared with operating earnings of $551 million, or 25 cents a share, a year earlier.

Analysts surveyed by Thomson Financial/First Call were expecting an operating loss of 12 cents a share.

It was the second straight quarterly operating loss after a streak of more than 15 years without one. The Schaumburg, Ill.-based company lost $533 million in the first quarter.


WASHINGTON (AP) -- Consumers seeking to save on prescription costs would be allowed to buy medicines from abroad by mail order under legislation the House approved Wednesday.

Lawmakers soundly rejected a broader measure that would have permitted distributors to import American-made pharmaceuticals that are sold more cheaply in other countries because of price controls.

The Food and Drug Administration opposed both measures, saying it cannot guarantee whether imported drugs are safe or effective. People caught ordering drugs from foreign sources frequently get warning letters from the FDA.

Prescription drugs can cost three to four times less in Europe and Canada than they cost in the United States.


FREEPORT, Ill. (AP) -- Shares in Newell Rubbermaid Inc. tumbled nearly 7 percent Wednesday after the housewares and consumer products maker warned that its earnings for the second quarter and full year will fall short of estimates.

The company cited declining sales as a result of the economic slowdown in the United States and Europe, as well as investment costs of an overhaul and streamlining begun this year under new chief executive Joseph Galli Jr.

It said it now expects to report per-share earnings of 29 cents a share for the second quarter and $1.20 to $1.30 for 2001. Analysts surveyed by Thomson Financial/First Call had estimated 37 cents for the quarter and $1.50 for the year.


NEW YORK (AP) -- Merrill Lynch & Co. became the first major brokerage to ban its analysts from buying stock in companies they research, a move designed to counter growing concern that analysts may be biased in their public assessments of stocks.

The measure, announced Tuesday, addressed one area of concern -- the potential for an analyst to have a direct, personal interest in touting a particular stock. Critics of the industry were quick to note, however, it does not deal with the potentially larger problem of influence on analysts from their firms' lucrative investment banking businesses.


NEW YORK (AP) -- A federal judge has rejected Random House's request for a preliminary injunction to stop an online publisher from selling electronic versions of ''Cat's Cradle,'' ''Sophie's Choice'' and six other books.

U.S. District Judge Sidney H. Stein ruled Wednesday that the right to print, publish and sell the works in book form in the contracts at issue does not include the right to publish the works in the electronic format.

In February, Random House sued RosettaBooks for offering e-versions of eight works the publisher had issued in paper form.

Among the books cited were such acclaimed novels as Kurt Vonnegut's ''Cat's Cradle'' and ''Slaughterhouse-Five'' and William Styron's ''Sophie's Choice'' and ''The Confessions of Nat Turner.''


WASHINGTON (AP) -- The government is delaying a planned auction of wireless licenses that are ideal for delivering high-speed Internet, video and other features to telephones and handheld devices.

The Federal Communications Commission said Wednesday it will push back the auction, scheduled for September, so the agency can address questions raised by several parties.

The auction involves frequencies now used by broadcasters still operating on channels 60 through 69. As they make the switch from analog to digital television, broadcasters eventually will give back those higher number channels to the FCC and will occupy only channels 2 through 51.


NEW YORK (AP) -- How hot is the market for coal?

The industry is about to find out as coal futures begin trading Thursday at the New York Mercantile Exchange.

Futures exchanges exist to transfer the risk of price volatility from people who don't want it -- in this case, power producers or steel manufacturers -- to speculators who are willing to take a gamble on making profits from this uncertainty.

Yet while more than half of the nation's electricity is derived from coal, analysts are skeptical that Nymex's Central Appalachian futures contract will succeed.

For starters, coal has little history of wide price fluctuations, a key ingredient in bringing together buyers and sellers. And of the roughly 1 billion tons of coal burned in the United States annually, 80 percent is bought through long-term contracts, not on the daily spot market.


By The Associated Press

The Dow Jones industrial average closed up 65.38 at 10,241.02, recovering more than half of Tuesday's 123-point drop.

Broader market measures were mixed with the Nasdaq composite index rising 9.25 to 1,972.04 and the Standard & Poor's 500 index slipping 1.34 to 1,180.18.

August unleaded gasoline was up .37 cent to 73.08 cents a gallon in trading.

August crude fell 38 cents to close at $27.11 a barrel and August heating oil fell 1.74 cent to 70.59 cents a gallon.

Elsewhere on the Nymex, natural gas futures gained 6 cents to $3.342 per 1,000 cubic feet. In London, Brent crude from the North Sea slipped 41 cents to $25.52 a barrel.

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