Wednesday, December 16, 2009, 10:36AM ET - U.S. Markets close in 5 hours and 24 minutes.

Tech and the Recession: Is the Worst Over?

Posted Apr 28, 2009 09:41am EDT by Sarah Lacy in Investing, Software and Services, Products and Trends, Recession, Clean Tech

Tech earnings were mixed last week, with Apple delighting Wall Street with strong results and Microsoft posting its first year-over-year drop in revenue. But you can say this much: There weren’t many bad surprises for investors. Does that mean the worst of the recession is over for tech?

My guest, Paul Kedrosky, says the air bubble of panic is gone and that’s good. But here’s the bad: There’s no big catalyst for corporate IT spending. That makes him worry that the big IT names like Oracle and Microsoft and Intel are out of the woods, but don’t have huge organic revenue growth ahead of them. (Oracle will no doubt get a bump when it digests the proposed Sun Microsystems deal, but that’s not exactly the same thing.)

Kedrosky does like a few sectors: Asian Internet companies, solar stocks and wireless. He explains why on the clip.

46 Comments

GerritD
GerritD - Tuesday April 28, 2009 09:55AM EDT

Were still too deep in it for it to be over. Look to October/November 2009 to see an upswing in this recession.

Yahoo! Finance User
Yahoo! Finance User - Tuesday April 28, 2009 10:01AM EDT

WOW, after reading mogleytheman I called my therapist. He put me back on meds and now I have to see him twice a week.

Yahoo! Finance User
Yahoo! Finance User - Tuesday April 28, 2009 10:02AM EDT

Why would Oracle, a software company, buy SUN, a hardware company? Please don't tell me it was JAVA, either. Regardless the platform, Oracle is as big a resource pig as Microsucks

John
John - Tuesday April 28, 2009 10:05AM EDT

The worst is that nobody is trying to get a handle on the corruption and collusion that is coming out of Washington and Wall St....... No trust = why bother

Yahoo! Finance User
Yahoo! Finance User - Tuesday April 28, 2009 10:17AM EDT

Yes, the worst is behind us, thank goodness. This has been really hard for almost a year now, but we know what we’re made of, and we were strong, and we made it through this nightmare. Things were so bad, at one point I nearly lost my faith. But that’s all over now, and everything will be peachy again.

Tony M
Tony M - Tuesday April 28, 2009 10:27AM EDT

"Tech is a discretionary expense for corporations"? What a complete moron. Tell the company paying their annual maintenance fee for SAP or Oracle software that it's discretionary. They are contractually obligated if they want upgrades or support, for software that manages multi billion dollar business units. This guy thinks IT is iPhones and nothing else. No credibility.

__A_YAHOO_USER__
__A_YAHOO_USER__ - Tuesday April 28, 2009 10:28AM EDT

YFU, 10:17AM, You believe the worst is behind us. Would you care to elaborate as to how you came to this conclusion?

Yahoo! Finance User
Yahoo! Finance User - Tuesday April 28, 2009 10:31AM EDT

Is Kedrowsky the only person who will talk with Tech Ticker? We are getting a very narrow view/opinion on the activity of SV.

Yahoo! Finance User
Yahoo! Finance User - Tuesday April 28, 2009 10:32AM EDT

Too bad all you shorts and bears missed the permanent bottom in March. You've already missed a huge move up. We are climbing a "wall of worry" and long-term investors will profit greatly over the next 5-10 years (especially in materials and energy and selective small-cap funds). This market has tremendous pent-up energy to move up, despite bad news that normally would cause the market to correct. Those who are waiting for a huge pull-back to "get back in" will be terribly disappointed. Us older investors who've been involved in the markets since the 70's know that the markets will climb a lot more and then plateau for awhile. Day-traders and those who bet against (short) fundamentally good companies will continue to lose their shirts.

Yahoo! Finance User
Yahoo! Finance User - Tuesday April 28, 2009 10:38AM EDT

YFU, 10:17AM, You believe the worst is behind us. Would you care to elaborate as to how you came to this conclusion? ------------------------------------------------------------------------------ I’m not really that good with words. Johnny does a much better job of pointing out the bright side than I do.

Yahoo! Finance User
Yahoo! Finance User - Tuesday April 28, 2009 10:54AM EDT

I'm tired of this Paul guy. Get others too. The SV part of TT is weak. And maybe Sarah needs to show us a bit more!

Elmer
Elmer - Tuesday April 28, 2009 10:57AM EDT

We still need to deal with the Anti-Stimulus activity of the Obama Administration and the Congress. This recession will be dragged out for months or years because of their actions. The 3rd quarter 2009 will be the worse of the year. Then we will need to pay for the wasteful spending either by higher taxes or inflation which will make the near future rough. Both are bad for everyone except for the power hunger politicians

Yahoo! Finance User
Yahoo! Finance User - Tuesday April 28, 2009 11:00AM EDT

I LOVE that song!

Yahoo! Finance User
Yahoo! Finance User - Tuesday April 28, 2009 11:04AM EDT

Everytime this Sarah chick interviews someone, it's always Paul Kedrosky. Well at least she's not winking at him this time. If she keeps this up in another couple of years, she will almost be acting like a professional.

Trevor
Trevor - Tuesday April 28, 2009 11:05AM EDT

There never was a recession in 'tech', so there is no recession to be 'over". As for the rest of the U.S. economy: reports of any recession have been severely overstated -- just an excuse to over-expand a bunch of worthless government programs and useless agencies.

Bill
Bill - Tuesday April 28, 2009 11:11AM EDT

Great! Now people will see the value of WZE

mmark
mmark - Tuesday April 28, 2009 11:13AM EDT

will any of the 3 sectors they spoke about, and the increases predicted translate into any american jobs? its all about jobs here. when the employment numbers reverse then we can start seeing the light at the end of the tunnel

__A_YAHOO_USER__
__A_YAHOO_USER__ - Tuesday April 28, 2009 11:24AM EDT

with America being over $57 trillion in debt...think not! http://mwhodges.home.att.net/nat-debt/debt-nat.htm

Timothy
Timothy - Tuesday April 28, 2009 11:31AM EDT

Sorry to state the obvious, but she needs to cover her blushing neck. Now, I am sure she was nervous, but showing a little cleavage and a blushing neck line was a little too distracting for me to take her seriously in her questions.

Yahoo! Finance User
Yahoo! Finance User - Tuesday April 28, 2009 11:32AM EDT

There are no technical jobs in America anymore. It's a myth perpetuated by TCS, WiPro and Infosys to place more of their people at your location.

Yahoo! reserves the right to refuse, or remove any comment that does not comply with the Yahoo! Terms of Service. The submission of spam, hateful, or obscene messages may result in the termination of your Yahoo! ID.
About Tech Ticker - Send FeedbackDisclaimer. Copyright © 2007 Yahoo! Inc. All rights reserved.
Copyright/IP Policy - Terms of Service - Privacy Policy - Help
Quotes delayed, except where indicated otherwise. Delay times are 15 mins for NASDAQ, NYSE and Amex. See also delay times for other exchanges.

Quotes and other information supplied by independent providers identified on the Yahoo! Finance partner page. Quotes are updated automatically, but will be turned off after 25 minutes of inactivity. Quotes are delayed at least 15 minutes for NASDAQ, NYSE and Amex. See also delay times for other exchanges. Real-Time continuous streaming quotes are available through our premium service. You may turn streaming quotes on or off. Fundamental company data provided by Capital IQ. Financials data provided by Edgar Online. Historical chart data and daily updates provided by Commodity Systems, Inc. (CSI). International historical chart data, daily updates, fund summary, fund performance, dividend data and Morningstar Index data provided by Morningstar, Inc. Analyst estimates data provided by Thomson Financial Network. All data provided by Thomson Financial Network is based solely upon research information provided by third party analysts. Yahoo! has not reviewed, and in no way endorses the validity of such data. Yahoo! and ThomsonFN shall not be liable for any actions taken in reliance thereon. All information provided "as is" for informational purposes only, not intended for trading purposes or advice. Neither Yahoo! nor any of independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. By accessing the Yahoo! site, you agree not to redistribute the information found therein.