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(April 24, 2001) -- The earnings parade marches on as Compaq Computer Corp. reports a 74% drop in first-quarter net income.

Compaq posted net profit of $78 million for the first three months of 2001, or 5 cents per share, compared with $296 million, or 17 cents per share, in the first quarter of last year.First-quarter revenues were $9.2 billion, down from $9.5 billion a year ago.

The world's second-largest computer maker also announced another round of layoffs, bringing the total number of employees cut to 7,000, or 10% of its workforce. The company said it will lay off 4,500 workers and lose another 2,500 through attrition.

Overall, analysts observed that Compaq made decent progress in reducing excess inventory amid rounds of price cutting and weakened demand for PCs.

Shares of Compaq dipped in mid-day trading, falling $2.85 to $17.80 on the New York Stock Exchange. -- Tobi Elkin

Copyright April 2001, Crain Communications Inc.

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