Computer network builder
reported a loss for its fiscal fourth quarter, in contrast to its profit in the year-earlier period, as the company dropped some businesses in its continued restructuring and excluded the results of its
3Com reported a net loss for the quarter ended June 2 of $146.8 million, or 42 cents a share, compared with net income of $87.5 million, or 24 cents a share, in the same quarter of 1999.
First Call/Thomson Financial
reported that a consensus of analysts it polled were expecting a loss of 44 cents a share. But First Call cautioned this figure excluded one-time gains and charges. 3Com did not report per-share results excluding these items.
The company said its net loss included two pretax charges totaling $74.8 million and a pretax gain of $89 million from investments. It said its operating loss totaled $340 million, compared with its previous projections for a loss of $450 million to $500 million.
"Fourth-quarter sales and operating losses were better than we projected," Eric Benhamou, 3Com's chairman and chief executive, said in a statement.
3Com said that sales decreased 33% as the company continued the major restructuring it begun earlier this year, which includes an exit from the analog modem business and a discontinuation of its high-end enterprise networking business. Overall sales for the quarter totaled $763.7 million, down from $1.235 billion for the same quarter last year.
In March, 3Com sold a minority stake in its Palm handheld-computer business, which is also listed under discontinued operations in the earnings report, and the sale contributed about $12.5 million to the company's net earnings. 3Com owns about 94.2% of Palm shares and that stake is slated to be distributed to shareholders next month. Palm will report full fourth-quarter earnings on Wednesday.
3Com released its financial results after the market closed Tuesday. Shares of 3Com rose slightly in after-hours trading and recently traded up 9/16, or 1.1%, at 49 1/4. The stock had ended the regular session down 1 11/16, or 3.35%, at 48 11/16.
The company also presented a more detailed timeline for its ongoing restructuring, saying it will finish leaving the analog modem and high-end enterprise networking business and complete an unspecified number of staff reductions by the end of the first quarter of fiscal 2001.
3Com said it its now focusing on higher-growth business such as broadband, wireless and Internet telephony, Benhamou said.
3Com also painted a rosier picture for the rest of the year. In a conference call, Michael E. Rescoe, the company's chief financial officer, said he expected sales to grow 1.5% to 7.6%, to the range of $775 million to $825 million, in the company's fiscal first quarter. He also said he expects operating losses to narrow to about $210 million to $240 million for the quarter, and he expects the company to return to profitability in the fiscal fourth quarter.
Earlier in the day, 3Com announced that it will buy
, a developer of Internet radio technology, for $80 million in cash.