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Tech Companies Post Strong Results

A bevy of technology companies reported healthy resultsyesterday, among them Microsoft, Computer Associates, and leading customer-relationship management vendor Siebel Systems Inc.

Strong PC sales, higher penetration of Windows NT on the corporate desktop, and the launch of Office 2000 drove a 30% increase in Microsoft's first quarter net income, the company reported yesterday. Microsoft earned $2.19 billion during its first quarter ended Sept. 30, compared with profits of $1.68 billion in the first quarter of 1998. Revenue climbed 28.4% during the most recent quarter, to $5.38 billion, compared with $4.19 billion one year ago. And operating income, which excludes a gain on Microsoft's sale of its online MSN Sidewalk city guide business, rose 37% in the first quarter. "The PC market remains very healthy," despite fears of overseas component shortages, said Microsoft chief financial officer Greg Maffei during a conference call with analysts.

Fueled by E-business growth, CA reported that revenue increased 32% to $1.6 billion in its second quarter, ended Sept. 30, compared to $1.2 billion reported in the previous year. Net income was $334,468,000 vs. last year's net income, which was just under $300 million. Second-quarter operating earnings per share, excluding acquisition-related amortization charges, were up 25% at 75 cents, compared to year ago earnings of 58 cents.

In a statement released after the market closed, CA Chairman and CEO Charles Wang said, "The rapid acceleration of global E-business strategies is therefore a real boon for CA, as more and more of our clients deploy back-end infrastructures to support the explosive growth of E-business." CA software for distributed systems increased 35% to $816 million in the quarter, and infrastructure growth centered on the OS/390 platform increased 19% compared with last year's second quarter.

For its part, Siebel showed no signs of losing its grip on the top spot in the CRM market, nearly doubling revenue for its third quarter. The company posted $195.3 million in revenue for the quarter ended Sept. 30, up from $104.2 million in the year-ago quarter. The company's profits rose at an even higher rate, growing 114% from $14.1 million. CEO Tom Siebel says he's optimistic the company can maintain a high growth rate even as it nears the billion-dollar mark. "I believe that we are on the verge of building one of the world's great companies," he says. Siebel says the company is unopposed in 39% of its sales opportunities.

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