Valley steps up its rebound (COMPANIES POST RECORD PROFITS, REVENUES FOR SECOND STRAIGHT YEAR)

San Jose Mercury News ^ | Chris O'Brien and Jack Davis

[nickcarraway]

Silicon Valley in 2005 continued its steady climb out of the depths of the bust.

While the year didn't exactly qualify as a boom, it nonetheless looked pretty good by the numbers.

Silicon Valley's 150 largest public companies notched up record profits and record revenues in 2005 for the second straight year, according to the Mercury News' annual SV150 survey. For the first time since 2001, the companies added a significant number of jobs.

While much of that hiring was outside the valley, the region also experienced an uptick in employment for the first time in four years, according to state government data.

Silicon Valley even recaptured some buzz with the widespread embrace of Apple's iPod and Google's search engine.

Yet these solid results didn't come without blemishes. Consolidation continued to eliminate companies and keep job gains slim. Corporations raked in cash but opted to stick it in the bank or give it to shareholders by repurchasing their own stock rather than spend it. And the growth in revenue and profits, while healthy, was notably slower than in the previous two years.

This fitful, modest improvement is expected to continue this year even as the pace slows a bit. But several economists said that measured expansion is preferable to the extreme highs and lows that turned the valley upside down in the Internet boom and bust several years ago.

`Back to normal'

``It's not the rapid growth we saw,'' said Doug Henton, president of Collaborative Economics, a Mountain View economic research firm. ``There doesn't seem to be any booms on the horizon. But we are getting about back to normal.''

By several measures, 2005 produced more evidence that Silicon Valley had regained its balance, if not its swagger:

[Mikey_1962]

Did you hear NPR this morning talking about States budgets being in the black because of the good economy?

I almost choked on my coffee.

[martin_fierro]

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[SF Republican]

Does it sound like to you that NPR is not AS biased as they have been recently? I did not hear the report you mention but lately I have been surprised at their reports (of course I mean after the obligatory daily bad story from Katrina and Iraq)

[newzjunkey]

Good for Arnold. Seems he was able to at least slow the exodus of business from California.

[null and void]

Or maybe NPR just realized that if the economy isn't booming, we don't need invaders undocumented guest workers...

[rellimpank]

---obscene profits?--I want Congress to tax some of this ---!!! (sarc)

[bkepley]

Global Corporate Socialists again.