The after-hours players turned a critical eye on stocks after another round of paltry profits.

Little reprieve came for the chips and related sectors Monday night. For starters, semiconductor-equipment firm Novellus Systems ( NVLS) slipped 3.9% to $44.55 on Instinet after reporting a sharp drop in second-quarter earnings after the closing bell. The stock was the second most heavily traded outfit on the platform, and the most heavily played stock on Island ECN, where it lost 4% to $44.50.

Novellus, which makes the equipment necessary for producing chip wafers, posted second-quarter earnings that beat the Street's expectations by a penny. Still, the tone of the company's forward guidance was grim, saying "business still remains weak" and that "there is significant uncertainty in the semiconductor industry at this time as both end-user markets in computers and telecommunications remain weak." Shares of Applied Materials ( AMAT - Get Report), a rival of Novellus, fell 3% to $45.68 on Instinet, while KLA-Tencor ( KLAC) dropped 3% to $45.25.

Applied Materials Chief Financial Officer Joseph Bronson reportedly told analysts at a trade show in San Francisco earlier Monday the company doesn't expect a recovery until mid- 2002. The company also didn't reaffirm its forecasts for its last completed quarter, a departure from past meetings.

The after-hours bloodletting came after a rough regular trading session to start the week. Wit Soundview issued a negative report on the sector, saying it faces weaker-than-expected demand for PC components and that price competition could cause added financial stress for Intel ( INTC - Get Report). The Philadelphia Stock Exchange Semiconductor Index fell 6% by the close. Intel, which is due to release its latest earnings numbers after tomorrow's close, recently lost 1.1% to $28.80 on Instinet as the most actively traded stock on the platform.

Published reports after the bell said Intel was cutting prices on some of its microprocessors by as much as 37%. Intel's price cuts are coming in the midst of a price war with its rivals and sluggish PC sales. Analysts have speculated that the company will have to reduce guidance when it reports Tuesday after the closing bell.

Meanwhile, other signs of weakness in corporate America abound. Symbol Technologies , maker of bar code scanners and software that tie its scanners into wireless local-area networks, tumbled 24% to $14 on Instinet after it warned that second-quarter results would fall "significantly below" consensus estimates.

With the glut of negative profit reports, no wonder investors cheered when Concurrent Computer ( CCUR) issued a positive earnings forecast Monday night. The company, whose products enable digital cable and DSL providers to offer their customers real-time video services, said it expects to meet or exceed its previous guidance, citing the growth from its real-time unit. Shares of the company gained 5.6% to $6.96 on Island.

And ahead of its earnings release tomorrow, Apple Computer ( AAPL) inched higher by 0.1% to $23.98 on Instinet. Analysts on average expect the PC maker to post third-quarter earnings of 15 cents a share, compared with 45 cents a share in the year-ago period.

10 most active stocks on Island ECN ( 6:10 p.m. EDT)
Company Price Change Session Volume
Novellus Systems (NVLS) 44.50 -1.87 421,546
Nasdaq 100 (QQQ) 41.95 n.a. 310,010
Concurrent Computer (CCUR) 6.96 +0.37 77,629
Applied Materials (AMAT - Get Report) 40.75 -1.20 76,539
Cisco Systems ( CSCO) 17.77 +0.06 68,814
JDS Uniphase ( JDSU) 10.66 +0.05 67,699
KLA-Tencor (KLAC) 44.91 -1.74 60,913
Intel (INTC - Get Report) 28.76 -0.37 60,461
Siebel Systems 39.44 -0.97 51,566
Exodus Communications /FONT> 1.38 +0.02 51,423

Island ECN offers trading mainly in Nasdaq-listed stocks, from 7 a.m. to 8 p.m. EST.

Confused? TheStreet.com explains how the rules change when the sun goes down in Investing Basics: Night Owl, a section devoted to after-hours trading.