Profits fell at Compaq Computer in the first quarter as the world's number two personal computer maker contended with a slowdown in PC sales and aggressive pricing by its rivals.

Compaq reported first quarter profit of $200 million (€223 million), or 12 cents per share, excluding a one-time charge of $249 million, and net investment income of $75 million and related tax effects. That compared with net income of 17 US cents per share a year ago and was below analysts' forecasts of 13 US cents a share, figures downgraded after a March profit warning.

Compaq employs about 2,200 people in Dublin, Galway and Belfast.