NEW YORK (CNN/Money) -
Technology stocks finished mostly lower Friday after Microsoft Corp. issued a weaker-than-expected earnings outlook and Amazon.com Inc. posted lower quarterly profits than anticipated.
The tech-dominated Nasdaq Composite index dropped 39.97 points, or more than 2 percent, to close at 1,849.09, falling to a nine-month low. The Philadelphia Semiconductor index lost 14.86 points, or 3.5 percent, at 405.58.
The news from the software giant and the Web's biggest retailer heightened investor concerns that earnings growth is slowing across the board.
Microsoft (MSFT: Research, Estimates), the world's second-largest company by market value, posted a quarterly profit in line with expectations after Thursday's bell but guided its outlook for the year lower as long-term corporate contracts expire and investment income slows.
Its stock fell 97 cents, or 3.3 percent, to close at $28.03 and was the most active on the Nasdaq.
Amazon.com (AMZN: Research, Estimates) posted quarterly profits that were a penny short of Wall Street's expectations and its forecast for the third quarter was also weaker than previously anticipated.
On Thursday, the online retail giant posted quarterly earnings of 18 cents a share, missing Wall Street estimates by a penny. Analysts also cited sluggish sales of 9 percent for books and music in North America, its traditional market.
Amazon noted a difficult comparison to last year's results, which included whopping sales of the latest Harry Potter book. Analysts said it would be difficult for Amazon to significantly reinvigorate this segment.
Its shares fell $5.84, or nearly 13 percent, to $39.98 and was also one of the most actively traded stocks on the Nasdaq.
Shares Broadcom Corp. (BRCM: Research, Estimates) also fell on Friday, amid concern over the media and communications chip maker's inventory situation a day after the company posted a profit and forecast continued revenue growth.
Broadcom stock fell $2.22, or 6.1 percent, to $34.18 on Friday. The stock has lost roughly a quarter of its value in July, weighed down by broad concerns over the health of the communications chip sector.
Broadcom posted a profit late Thursday as revenue rose 12 percent quarter-over-quarter. For the current quarter, the company forecast revenue growth of 5 percent to 7 percent.
But Broadcom said it saw orders slowing as manufacturers ran through excess inventory. The company's own inventories also grew, part of what it has called a strategy to build supplies of parts in high demand.
Among other tech heavyweights, Intel Corp. (INTC: down $0.60 to $22.67, Research, Estimates) lost 2.3 percent on the session, while Cisco Systems (CSCO: down $0.46 to $20.93, Research, Estimates) shed 2.2 percent.
Oracle Corp. (ORCL: down $0.26 to $10.10, Research, Estimates) and Sun Microsystems (SUNW: down $0.11 to $3.69, Research, Estimates) also finished in the minus column.
International Business Machines (IBM: down $1.21 to $84.85, Research, Estimates) also finished lower on the New York Stock Exchange.
Internet marketing company DoubleClick also had a rough day on Friday. Its shares fell sharply after the company posted a drop in quarterly net income and sharply reduced full-year sales and profit forecasts due to weakness in two key business arenas.
DoubleClick (DCLK: down $1.92 to $5.06, Research, Estimates) shares fell nearly 28 percent Friday. Its earnings report was released after the close Thursday.
In the chip sector, shares of Taiwan Semiconductor (TSM: down $0.49 to $6.72, Research, Estimates) fell sharply after brokerage firm Pacific Crest downgraded the stock to "sector perform" from "outperform."
-- from staff and wire reports
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