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September 11, 1990

TANDEM COMPUTERS WARNS THAT WALL STREET MAY BE EXPECTING TOO MUCH OF IT

By CBR Staff Writer

Tandem Computers Inc warns that rapidly changing economic factors may reduce the company’s growth rate with respect to Wall Street expectations. According to founder and chief James Treybig, Our sales activity is at an all time high but our order close rate is slower than expected. It is possible that revenue growth will be less than planned. We have instituted additional cost control measures in order to maintain acceptable profit margins. New products such as the top-end NonStop Cyclone and Integrity S2 fault-tolerant Unix system are generating high growth in Japan, Southeast Asia, Germany, Holland, Italy and Spain, the company says, but notes that other countries, such as the UK, Australia and Canada, are experiencing high interest rates, economic uncertainty, slowing national growth rates and difficulties in the financial sector, and that the Eastern United States is particularly weak for many of these same reasons. The company says that next year, it will be introducing new products for the CLX systems, including significantly increased performance, new communications capability and lower cost models. Ungermann-Bass is still growing well and is profitable, it says.

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