Yahoo, Microsoft and Google took center stage in the tech sector this week, as Yahoo announced an advertising deal with rival Google after revealing that its takeover talks with Microsoft Corp. had ended without a deal.
Yahoo Inc. announced its decision to work with the Internet advertising leader late Thursday, shortly after saying it could not convince Microsoft Corp. to renew its previous offer to buy Yahoo for $33 per share.
Yahoo shares finished the week down 11.2 percent at $23.47.
Yahoo estimated Google could help increase its annual revenue by $800 million, but the deal did not pacify disappointed investors who were still hoping for a deal with Microsoft, the world's largest software company.
Elsewhere in tech, computer and gadget maker Apple Inc. said on Monday that in July it will begin selling an iPhone model that works over faster wireless networks and supports satellite navigation. An 8-gigabyte model will cost $199, while a 16 GB model will cost $299.
Apple is also leaving behind revenue-sharing agreements with some wireless carriers, which frees the carriers to raise prices for their services.
Also during the week, chip stocks declined Wednesday after the Semiconductor Industry Association reduced its 2008 chip sales growth forecast, citing ongoing pricing pressure in memory chips, and in DRAM memory chips in particular.
DRAM memory chips store information in personal computers and other devices.
The industry trade group now expects growth of 4.3 percent for the year, down from a previous prediction of 7.7 percent.
Chip stocks staged a recovery Thursday and Friday, but the Philadelphia Semiconductor Sector Index still finished the week down more than 5 percent.
It was a lackluster week for video game stocks, too, even though market researcher NPD Group said Thursday that sales of games, consoles and accessories rose 37 percent in May from the same month in 2007.
NPD estimated May sales of $1.12 billion for the sector, with hardware sales rising 34 percent to $428.6 million and software sales climbing 41 percent to $536.9 million.
Take-Two Interactive Corp.'s "Grand Theft Auto IV" remained the best-selling video game, with 871,300 units sold in the month.
IN CASE YOU MISSED IT: Beijing-based online gaming company Perfect World Co. raised its second-quarter sales guidance Friday despite the impact of the recent earthquake, citing better-than-expected results from new expansion packs and recent marketing campaigns.
Like its peers, Perfect World stopped its Web operations for three days during the quarter as part of a national mourning period in China after the May 12 quake in Sichuan province.
Perfect World's shares shot up after the guidance increase, finishing the week up 4.6 percent at $25.15.
COMING UP: Software company Adobe Systems Inc. is scheduled to report its second-quarter results on Monday.
In March, Adobe predicted second-quarter earnings between 35 cents and 37 cents per share _ or 45 cents to 47 cents per share on an adjusted basis _ with revenue of $855 million to $885 million.
Analysts polled by Thomson Financial expect adjusted earnings of 46 cents per share on $879.9 million in revenue.
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Compiled by Rachel Metz and Dan Scheraga, AP Business Writers in New York.
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