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The company said sales would be significantly lower this year as the wholesalers shipped those excessive inventories.
Industry analysts estimate that wholesalers were holding about $1 billion or more of excessive inventories of Bristol-Myers products in April.
The increase in labor costs comes at a time businesses are already struggling with smaller profits because of falling demand and excessive inventories.
But businesses, depressed by the bursting of the bubble and stuck with excessive inventories and far too much capacity, hunkered down.
Though demand for these chips is growing rapidly, Mr. Aylesworth said that computer makers already had excessive inventories of components such as hard drives.
In early April, shares of Bristol-Myers tumbled after Peter R. Dolan, the company's chairman, announced that wholesalers were holding hundreds of millions of dollars in excessive inventories of the company's products, which would reduce revenue this year.
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Agents differ in their need for trade as well as the cost to hold excessive inventory.
What prevented that from happening this time? A. Low interest rates coupled with the lack of excessive inventory.
But in the dynamic environment, the results of them may become inaccurate causing excessive inventory (cost) or shortage.
As it turned out, most of the recession of 1957-58 was a result of a runoff of excessive inventory accumulation rather than a failure in underlying demand.
The Acer chairman, JT Wang, told an investor conference that the second-quarter was a "correction period" and its loss was worse than expected because the company cleared up excessive inventory and made severance payments for senior management resignations.
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