Last week in Silicon Valley:
Monday
The real estate market continued to slump last month in our lovely Valley of Heart's Delight, San Diego real estate tracking firm DataQuick reported. In Santa Clara County, the median price for an existing single-family house dropped 4.5 percent from a year earlier to $525,000, and the number of transactions was down 2.1 percent. As for the condominium market, sales volume climbed 5.2 percent, but the median price plunged 17.9 percent to $275,000. Throughout the Bay Area, the number of home sales was the lowest for an April in three years. "What's clear now is that 2011 is off to a slow start, but it's a little soon to write off the rest of the year," DataQuick President John Walsh noted.
Tuesday
Hewlett-Packard's (HPQ) stock plummeted more than 7 percent after the Palo Alto tech pioneer reported earnings for its most recent quarter. HP had been scheduled to release results Wednesday, but moved up the report after the leak of a confidential memo from CEO Léo Apotheker, who warned of slower growth for the rest of the year. HP's second-quarter results beat Wall Street expectations, with
revenue rising 3 percent from a year earlier to $31.6 billion, and profit climbing 5 percent to $2.3 billion. As for the rest of the fiscal year, though, HP now expects it will be hurt by the effect of the earthquake in Japan, reduced profitability in its services business and "softness in sales of consumer PCs," according to a statement accompanying the earnings. In the second quarter, HP's commercial computer sales jumped 13 percent year over year. However, consumer PC sales plunged 23 percent, bringing overall revenue in its personal systems group down 5 percent. According to a Merc report, Apotheker said HP will take "prudent steps" to manage its costs, but that doesn't necessarily mean "across the board" staff cuts.
Mountain View online professional-networking upstart LinkedIn raised the expected price for its initial public offering of stock. Earlier, it planned to sell shares at $32 to $35 each. According to a Securities and Exchange Commission filing, LinkedIn increased that to a new range of $42 to $45. The next day "...
Wednesday
"... LinkedIn's IPO priced at the high end of that new range, showing investors' enthusiasm for social media upstarts. At $45 a share, the offering valued LinkedIn at more than $4 billion -- making it the biggest IPO for a U.S. Internet company since Mountain View online search juggernaut Google (GOOG) went public way back in 2004. (LinkedIn is the first big social media name to sell its stock to the public, although Palo Alto social networking powerhouse Facebook, San Francisco microblogging pioneer Twitter and San Francisco social games upstart Zynga are expected to have their own IPOs, perhaps in the next year or so.) The next day "...
Thursday
"... LinkedIn shares skyrocketed 109 percent from their offering price as they began trading on the New York Stock Exchange -- where co-founder and Chairman Reid Hoffman, CEO Jeff Weiner and other LinkedIn executives rang the opening bell to celebrate the IPO. The shares debuted at $83 when trading began, then climbed as high as $122.70. They closed at $94.25, up $49.25, or 109.4 percent, from the $45 offering price. That gave LinkedIn a market value of $8.9 billion -- more than such well-known Silicon Valley companies as Electronic Arts (ERTS), Advanced Micro Devices and National Semiconductor.
Friday
Of course, many LinkedIn members use the site to find new jobs or other opportunities. Here in Silicon Valley, employers added 2,900 new workers last month in such sectors as computer and semiconductor manufacturing, the California Employment Development Department reported. That brought the unemployment rate in the beautiful (if bureaucratically named) San Jose-Sunnyvale-Santa Clara metro area to 10.1 percent, down from 10.6 percent in March and 11.4 percent in April 2010. The total number of jobs reached 871,300, up 1.6 percent year over year, with big gains in the information sector, which includes software publishers and Internet companies.
As for LinkedIn, its shares fell slightly on their second day of public trading, dropping $1.16, or 1.2 percent, to $93.09 -- giving the company a market value of $8.8 billion.
Frank Russell writes the 60-Second Business Break, posted weekdays by 2 p.m. at MercuryNews.com and SiliconValley.com. Contact him at frussell@mercurynews.com or 408-920-5876. Follow him at Twitter.com/mercspike.
A good week for Amazon
Less than four years after the Seattle online retail giant introduced the Kindle e-reader, it revealed that it's now selling more books in electronic than physical formats. "We had high hopes that this would happen eventually, but we never imagined it would happen this quickly," Amazon CEO Jeff Bezos noted. Since April 1, according to the company, Amazon has sold 105 Kindle books for every 100 hardcover and paperback books consumers bought on the site.
A bad week for the Winklevoss twins
An 11-judge 9th Circuit Court of Appeals panel turned away the latest attempt by former Harvard University rowers Cameron and Tyler Winklevoss to revive their lawsuit over Facebook's origins. A three-judge appeals panel had ruled that the Winklevoss twins were "sophisticated parties" when they agreed to settle the dispute. Undaunted, the twins (who contend that Mark Zuckerberg stole their idea for Facebook) intend to ask the U.S. Supreme Court to step in.