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Microsoft, Intel reports weigh on PC stocks

The Associated Press

The shares of companies that rely on personal computers for their success fell Friday as recent reports from Microsoft, Intel and other companies showed damage from the decline in the PC market.

Consumer demand for personal computers has fallen as people increasingly turn to their smartphones and tablets for their computing. That's hurt makers of PCs as well as the manufacturers of software and chips that power computers.

Microsoft Corp.'s shares fell more than 11 percent to close at $31.40 — the biggest one-day drop since January 2009. The software giant behind Windows, the Xbox and Surface tablets on Thursday reported disappointing results for its latest quarter. The results fell far below Wall Street's expectations and included a large write-off for its tablet computer Surface RT business, due to poor response to the product. A weak reception for Windows 8 also contributed to a revenue drop. The company announced a major reorganization late week, aimed at helping it transform into a "devices and services" company that is less reliant on providing software for personal computers.

Shares of PC maker Hewlett-Packard Co. also fell, dropping 4.5 percent to $25.14. Dell shares inched up 2 cents to $13.14. Dell is in the midst of a buyout fight. Founder and CEO Michael Dell wants to take the company private for $24.4 billion so he can revive its fortunes, but several big shareholders have argued that price is too low.

Advanced Micro Devices Inc. shares fell sank 13 percent to $4.03 after the chipmaker on Thursday reported a second-quarter loss on lower revenue stemming from the worldwide slump in PC demand. Rival Intel Corp., the world's biggest chipmaker, posted disappointing results on Wednesday, saying that its sales of processors for servers and mobile gadgets were not enough to make up for the decline in computer sales. Its shares dipped almost 1 percent to $23.04 Friday.

Shares of some other chipmakers, such as Nvidia Corp., also slipped Friday.