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Wall Street Journal: VA Linux Warns of Slow Sales, Blaming Weak Dot-Com Business

Nov 07, 2000, 16:09 (3 Talkback[s])
(Other stories by Lee Gomes)

"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."

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