It has been a good week for the Irish IT sector, with technology firms announcing plans to create more than 330 jobs here. John Collinsreports.
This buoyancy, however, was not broadly reflected in the first-quarter results of international technology and telecommunications companies with operations here, many of which struggled to meet market expectations.
IBM, which employs more than 3,000 people in Ireland, and Yahoo, which has plans to employ 400 people in Dublin by 2010, both disappointed Wall Street.
Although IBM's net income rose to $1.84 billion (€1.35 billion) on revenues of $22.03 billion, the market reacted to comments about slow spending on new technology in the US by sending its stock price lower.
Yahoo missed expectations with an 11 per cent fall in first-quarter profits, which sent its share price down 8 per cent. The company hoped that a new software platform for advertisers, dubbed Panama, would help it regain market share in the lucrative internet advertising market.
Analysts said Yahoo was unlikely to close the widening market share gap with Google any time soon.
In contrast, Google (see panel) managed to blast through even the inflated expectations that attach themselves to the darling of the internet with a record net profit of $1 billion.
Another strong performer was eBay, which posted a 52 per cent jump in net profit to $377 million. EBay and its PayPal subsidiary employ more than 800 people in Blanchardstown, west Dublin.
Buoyant figures from data storage group EMC also spelt good news for its Irish operations. Net income of $312.6 million, up from $272.5 million a year earlier, was largely driven by growth in its new software businesses such as the VMware subsidiary. In February VMware announced a significant expansion of its technical support centre in Ballincollig, Co Cork, which will create 369 jobs.
Earnings from chip giant Intel suggested that business has turned a corner at one of the country's largest employers after a series of disappointing results and cost-cutting.
Although sales fell slightly, profits rose 19 per cent to $1.6 billion, partly due to a once-off tax benefit and more efficient production processes. The company's Flash memory unit, which some analysts had speculated might be sold off, continued to lose money, racking up losses of $283 million in the quarter.
SAP, which employs 640 in Dublin and Galway, yesterday delivered solid results, showing a 10 per cent rise in sales of software licences.
The German software maker, which recently celebrated 10 years in Ireland, had a tough quarter due to the sudden departure of a key manager and the launch of a lawsuit by rival Oracle. Both revenue and profits were up 6 per cent year-on-year, at €2.2 billion and €433 million respectively.
Mobile phone maker Motorola had a torrid first quarter. Its $181 million net loss reinforced the view that its decision to close its Cork software development centre last month was due to the poor performance of the company as a whole rather than any failing at its Irish operations.
Motorola's results were in sharp contrast to the world's largest mobile phone maker, Finland's Nokia, which on Thursday said it had made a net profit of €979 million.
Analysts said Nokia had been able to capitalise on Motorola's policy of slashing prices in an attempt to grow market share.
