ChangeWave Research - 3Q/4Q 2006 Corporate Sales Report

Looks Like a Soft Landing – But With Some Very Jagged Edges

Rockville, MD (PRWEB) September 18, 2006 -- The latest ChangeWave Research Corporate Quarterly Sales Survey shows the 3rd Quarter experiencing slightly slower growth than the previous quarter – but with noticeable gains occurring in Defense Contracting and the Energy Utilities sector.

On the downside, the biggest quarter-over-quarter declines have occurred in Semiconductors, Financial & Investing Services, and Natural Gas & Oil. Moreover, capital spending is the flattest it’s been in more than three years.

“Overall, the survey results point to a soft landing in the economy, but with some very jagged edges – particularly in terms of business spending,” says ChangeWave Research Director Paul Carton. “The Achilles heel in the whole soft-landing equation could be the downturn in capital spending.”

A total of 2,639 business, technology and medical professionals who work in NASDAQ-related industries participated in the survey, conducted August 29-September 6.

Slightly Slower Sales Growth. While nearly a third of respondents (32%) are now projecting that their company sales will come in “Above Plan” for 3rd Quarter 2006, this is 1-point less than the previous quarter. Another 21% report their company sales will come in “Below Plan” – 1-point worse than previously.

There is also slightly reduced visibility going forward. Sales pipeline projections for 4th Quarter 2006 show 34% of Alliance members saying their company will come in “Above Plan” – 2 points less than the previous quarter. At the same time, 14% say they’ll be “Below Plan,” 2 points worse than previously.

Easing Price Pressures. The news is positive on the inflation front. Only 17% report prices are rising for their company’s products – down 2 points from last quarter. This easing in price pressures is a reversal of the inflationary pressures found in the previous ChangeWave quarterly sales survey.

Capital Spending – The Achilles Heel? In the most negative finding of the survey, capital spending appears the flattest it’s been in more than three years. Only 15% of respondents expect an “increase” in their overall capital budget for the 4th Quarter – 2 points less than previously. Another 15% think they’ll see a “decrease” – 5 points worse than the previous quarter.

In another bearish sign, 9% of respondents report that their company is experiencing an increase in cancelled orders – 2 points more than in the previous quarter and the highest percentage in two years.

The ChangeWave Alliance is a network of 8,500 highly qualified business, technology, and medical professionals in leading companies of select industries—credentialed experts who spend their everyday lives working on the frontline of technological change. ChangeWave surveys its Alliance members on a range of business and investment research and intelligence topics, collects feedback from them electronically, and converts the information into proprietary quantitative and qualitative reports.

For a copy of the entire ChangeWave Research Corporate Sales Survey, please contact Darlene March, 714-514-3736.

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