SBC Communications Inc. (SBC: chart), the U.S. second-largest local phone company, announced early Monday that it agreed to acquire AT&T Corp. for $16 billion, mainly in stock. The deal will likely create the largest communications company in the U.S. The board of the San Antonio, Texas-based company approved the deal on Sunday evening, followed by the board members of AT&T, who approved the deal a few hours later. The acquisition is expected to close by the first half of 2006. Bedminster, New Jersey-based AT&T, which is still the No.1 long-distance company in the U.S., has more than 30 million long-distance customers. Its business services unit, which provides voice and data services, generates more than 70% of the company’s total revenues. SBC's acquisition of AT&T will include $14.7 billion in SBC stock and a special dividend of about $1.04 billion to be paid by AT&T to its shareholders when the deal closes. Under terms of the agreement, shareholders of AT&T will receive total consideration currently valued at $19.71 per share, or about $16 billion. AT&T shareholders will receive 0.77942 shares of SBC common stock for each common share of AT&T. AT&T will pay its shareholders a special dividend of $1.30 a share.

Microsoft Corporation (MSFT: chart) posted after market close Thursday quarterly earnings that more than doubled from last year, driven by strong demand for its personal computers and videogames. The software titan rolled out net income of $3.46 billion, or 32 cents per share, for its fiscal 2005 second quarter, against net income of $1.55 billion, or 14 cents per share, a year ago. Both quarters included an expense for equity compensation. Excluding items, the company earned 35 cents per share for the quarter ended December 31, up from 34 cents per share, last year, and 2 cents ahead of the consensus analysts’ estimate. Quarterly revenue edged up 6.5% to $10.82 billion from $10.15 billion. The Redmond, Washington-based company said its home and entertainment division swung to an operating profit of $84 million in the second quarter from a prior-year loss of $397 million, boosted by solid sales of its Halo 2 videogame. Microsoft’s server group recorded sales of $2.5 billion for the three-month period, an 18% increase year-over-year, due to improving corporate spending.

Microsoft raised its 2005 financial estimates and now expects to earn between $1.09 and $1.11 per share, on revenue of $39.8 billion to $40 billion, for the full year, compared with an earlier outlook for earnings of $1.07 to $1.09 per share, on revenue of $38.9 billion to $39.2 billion.

Company shares closed Thursday at $26.11, up 10 cents, or 0.38%. The stock rose 1.76% to $26.57 in extended session.

Boosted by strong retail sales, Gateway, Inc. (GTW: chart) of Irvine, California, on Thursday turned in a net profit of $93.9 million, or 23 cents per share, for its fourth quarter, rebounding from a net loss of $114.1 million, or 35 cents per share, for the 2003 comparable period, when restructuring charges weighed on results. Excluding a gain from the retirement of preferred stock held by AOL and other items, the computer company had a profit of 4 cents per share for the quarter ended December 31, surpassing the average analysts’ forecast of 2 cents per share. Quarterly revenue rose to $1.03 billion from $875.1 million, aided by the company’s purchase of eMachines in March 2004.

The stock gained 5 cents on Thursday to $5.00. Gateway shares soared 4.20% to $5.21 in after-market trade.

The Procter & Gamble Company (PG: chart) reported Thursday a 12% rise in its quarterly profits, aided by solid sales growth and higher prices. The Cincinnati, Ohio-based consumer-products company said it earned $2.04 billion, or 74 cents per share, in its second quarter, up from $1.82 billion, or 65 cents per share, for the 2004 equivalent. The earnings topped by 2 cents a share Wall Street’s mean estimate. Net sales for the quarter rose 9% to $14.45 billion, helped by the weak dollar.

P&G announced Friday that it will buy Gillette Co. for about $57 billion in stock.

P&G shares dropped 12 cents to $55.32 at market close Thursday.

Siebel Systems, Inc. (SEBL: chart) of San Mateo, California, announced Thursday that its fourth-quarter income jumped 32% to $53.8 million, or 10 cents a share, from $40.7 million, or 7 cents a share, generated a year earlier. The results of the software maker outpaced the mean analysts’ estimate of 8 cents per share. Quarterly revenue advanced to $392.4 million from $366.7 million, in 2003. Siebel attributed the results to strong growth in license revenue.

The stock inched up 4 cents to close Thursday at $9.14. Siebel shares slipped 0.33% to $9.11 in extended-hours trading.

Sanmina-SCI Corporation (SANM: chart) posted Thursday higher quarterly earnings and revenue, which, however, missed Wall Street’s expectations, hurt by pricing pressures and a sluggish business climate. The San Jose, California-based contract electronics manufacturer reported first-quarter net income of $24.4 million, or 5 cents per share, up 55% from year-ago income of $15.8 million, or 3 cents per share. On a pro forma basis, earnings totaled 9 cents per share, falling a penny short of the average analysts’ forecast. Revenue for the quarter improved 10% to $3.25 billion. Analysts had expected revenue of $3.4 billion.

Company shares closed Thursday up 7 cents, or 0.95%, at $7.42. The stock plunged 8.89% to $6.76 in after-market trade.

Novellus Systems, Inc. (NVLS: chart) of San Jose, California, reported Thursday a huge rise in its quarterly profits, driven by surging sales. The maker of semiconductor production equipment rolled out net earnings of $37.5 million, or 27 cents per share, for its fourth quarter, in contrast to earnings of $10.5 million, or 7 cents per share, for the prior-year equivalent. The consensus analysts’ forecast was for a profit of 24 cents per share. Quarterly sales soared to $340.3 million from $226.5 million, last year.

The stock rose 3.05% on Thursday to $26.68. Company shares dropped 8 cents to $26.60 in after-hours trading.