Network World Research Shows 2000 Sales Up, Profits Down For Network Companies

SOUTHBOROUGH, MA – April 23, 2001 – Network World, the nation's leading network news publication, today published its annual guide to the 200 biggest public companies in the network industry, ranking the companies by revenue, profits, highest value, fastest growth, earnings per employee, and R&D spending. Despite the doom and gloom that settled in after the stock market bubble burst in April 2000 and the economy began heading south, the Network World 200 finished the year with revenue up 14%. Sales for the NW200 reached $909 billion, a $110 billion gain from the year before. But profits tanked, dropping to $63 billion, 9% lower than the $69 billion the NW200 posted in 1999. Nearly half of the companies — 91 of them — reported losses in 2000.

 

The NW200 spans a range of companies, from $88 billion behemoth IBM at the top to $60 million Mobius Management, a comparative mouse at the bottom. As a rule, the heavy hitters typically enjoy slower revenue growth but are more profitable. The 69 NW200 companies with revenues of $1 billion or more saw sales grow 12% last year and profits scale even more, to 16%. The 131 companies with less than $1 billion dollars in revenue enjoy even faster growth, but many are still in investment mode or are outright floundering. These companies saw sales spike 47% last year, but losses climbed to $23 billion from $5 billion in 1999. Added up, it would appear that the souring economy didn't go bad fast enough to ruin the top-line numbers of NW200 last year. But it certainly squeezed profits for the smaller guys and left the group peering furtively over the horizon at 2001. But there are some bright spots.

Juniper Networks for example, lords over the list of fastest-growing NW200 companies with revenue of $500 million or more in 2000. This company, No. 83 on the NW200, has earned a solid reputation among service providers — 225 are its customers – with its high-end Internet infrastructure products. And, Hewlett-Packard, No. 5 on the NW200, may be the mover to watch this year. The company is newly focused under CEO Carly Fiorina, who is coming up on her second anniversary with the company. Sales for 2000 were up 15% to $48.8 billion and profits up 6% to $3.7 billion.

The Network World 200 Issue not only probes into market and economic factors affecting the companies on the top 200 list, but also explores other key industry issues including: What's the prognosis for how the year will unfold in three key market segments – enterprise infrastructure, carriers and ISPs, and enterprise applications? Who are the 10 hot networking start-ups to watch this year? Are network vendors delivering on their globalization promises? How are the NW200 companies performing in the stock market?

The latter information comes from the NW200 index, which tracks stock performance and provides historical views of the top 200 networking companies as a whole. The NW200 Index, an interactive version of the NW200 list that offers comparisons among companies, historical overviews and rankings by various criteria, are available online at a special NW200 portal, at http://www.nwfusion.com/nw200/2001/.

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Network World, Inc. is a division of IDG, the world's leading IT media, research and exposition company. IDG publishes more than 300 magazines and newspapers and 4,000 book titles and offers online users the largest network of technology-specific sites around the world through IDG.net (http://www.idg.net), which comprises more than 270 targeted Web sites in 70 countries. IDG is also a leading producer of 168 computer-related expositions worldwide, and provides IT market analysis through 50 offices in 43 countries worldwide. Company information is available at http://www.idg.com.