“VA Linux Systems Inc. plummeted 42% after the company reported
that slowing sales to Internet companies would lead to
lower-than-expected results for the latest quarter….”
Shares in other Linux companies, such as software provider Red
Hat Inc., have taken similar tumbles in recent weeks, suggesting
that the Wall Street craze for anything Linux-related has suffered
the same fate as that for consumer-oriented Web sites. Red Hat
shares were hurt by the VA Linux sell-off, closing Monday at
$15.69, down $1.31, or 7.7%….”
“Because of the slowdown in orders from Internet-oriented
companies, VA Linux said it will now put more emphasis on marketing
to established businesses. But in doing so, analysts note, it will
be competing with the likes of International Business Machines
Corp., Dell Computer Inc. and other major computer makers, all of
which have undertaken major Linux efforts this year. Indeed, Wall
Street bears about Linux hardware companies like VA Linux have
always maintained that since Linux hardware is essentially
indistinguishable from ordinary personal-computer hardware, Linux
companies would have a hard time differentiating themselves from
bigger computer companies.”