Microsoft's Earnings Threatened by More Than Dwindling PC Demand

Microsoft's (MSFT Quote) future earnings may be threatened by more than evaporating PC demand as the value of its investments in other companies shrinks with the Nasdaq Composite Index.

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In the software giant's first quarter, which ended Sept. 30, about 3 cents of its profit of 46 cents a share came from $600 million in gains on equity investments. Two of that 3 cents of the gain were from the sale of stakes in TransPoint and Titus Communications.

But with the Nasdaq off more than 39% in 2000, Microsoft, like any tech investor, has most likely seen the value of some of its holdings fall. Many companies like Intel (INTC Quote) and Gateway (GTW Quote) are facing this problem, as well.

Both Kinds

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