Novell moves into black in 2d quarter

Costco Wholesale Corp. reported a 32 percent jump in fiscal third-quarter profit, topping Wall Street expectations, as cash-squeezed customers flocked to its warehouse clubs in search of bargains on food and toiletries. (Elaine Thompson/Associated Press)

Novell Inc., the second-largest US seller of Linux software, reported a second-quarter profit of $5.87 million after trimming jobs and narrowing its product focus.

Net income was 2 cents a share, compared with a loss of $2.89 million, or 1 cent, a year earlier, Waltham-based Novell said. Revenue rose 1.4 percent to $235.7 million, matching analysts' estimates.

Chief executive Ron Hovsepian slashed about 10 percent of jobs last year and focused on new Linux products, seeking to counter a drop in revenue from older software. Sales of its Linux operating system rose 31 percent to $29 million last quarter.

Excluding some costs, profit was 6 cents a share, more than the 5-cent average estimate of analysts surveyed by Bloomberg. They projected revenue of $234.4 million for the quarter, which ended April 30. (Bloomberg)

Costco Wholesale Corp. posted a 32 percent jump in its fiscal third-quarter profit, topping Wall Street expectations, as cash-squeezed customers flocked to its warehouse clubs in search of bargains on food and toiletries.

But the company said Wall Street's forecast for the fourth quarter might be too high.

Net income rose to $295.1 million, or 67 cents per share, from $224 million, or 49 cents per share, a year ago, which included a $30.3 million charge.

Sales increased 13 percent to $16.26 billion from $14.34 billion in the year-ago period. Including membership fees, revenue rose to $16.61 billion from $14.66 billion.

Analysts surveyed by Thomson Financial had expected a profit of 65 cents per share on revenue of $16.35 billion. (AP)

Battered retailer Sears Holdings Corp. posted its largest quarterly loss since Sears and Kmart combined, providing surprising results far below Wall Street forecasts and issuing a dour sales forecast for the remainder of the year.

The company said it lost $56 million, or 43 cents per share, in its first quarter as it fought for shoppers and cut prices to clear merchandise.

That's a dramatic reversal from the retailer's year-ago profit of $223 million, or $1.45 per share.

"It was a pretty ugly quarter," said Morningstar analyst Kim Picciola. Not only are they facing the challenges from the uncertain macro environment, but they're still struggling internally from some of their own issues."

On an adjusted basis, the loss was 53 cents per share for the three months ending May 5, compared with profit of $1.15 per share in the same period last year.

Lead by financier Edward Lampert, who acquired Kmart in 2003 and Sears, Roebuck and Co. in 2005, Sears is in the midst of a high-stakes restructuring aimed at reconnecting with shoppers and reinvigorating atrophied same-store sales, which have fallen for the past nine consecutive quarters.

Sears said customers were forced to spend more money to cover the soaring costs of gas and food. That knocked down sales nearly 6 percent to $11.1 billion.

Analysts surveyed by Thomson Financial expected profit of 15 cents per share on sales of $11.41 billion. (AP)

Dell Inc., the world's second-largest personal-computer maker, reported a first-quarter profit that exceeded analysts' estimates as sales overseas outstripped US orders for the first time.

Net income rose 3.7 percent to $784 million, or 38 cents a share, from $756 million, or 34 cents, a year earlier, Round Rock, Texas-based Dell said. That beat the 33-cent average of estimates compiled by Bloomberg. Sales climbed 9.2 percent to $16.1 billion, also beating projections.

The results are "early signs" of a turnaround, chief financial officer Donald Carty said on a conference call. Chief executive Michael Dell has spent the past year forging partnerships with retailers such as Wal-Mart to help narrow the gap with Hewlett-Packard. (Bloomberg)

Netezza Corp, a Framingham computer equipment maker, said it swung to a first-quarter profit of $2.1 million, or 3 cents a share in its first quarter, compared with a loss of $3.4 million, or 44 cents a share, a year earlier, beating Wall Street's expectation of 2 cents a share.

Revenue grew 57 percent to $39.6 million, vs. $25.3 million, also beating Wall Street's expectation, which was $36.2 million.

Netezza also raised its 2009 revenue outlook to $172 million from $165 million to $168 million. Wall Street analysts, on average, expect $166.7 million in revenue.

"We just don't see any weakness in the business," said president Jim Baum. (Wire services)