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Agilent Technologies, Sonoma County's largest high-tech employer, saw sales continue to slow this summer but executives at its Santa Rosa unit said there are signs that business is picking up.

The company, which announced plans in May to lay off 450 workers around the globe, reported that profits fell to $168 million in the quarter ending July 31, down 31 percent from a year ago.

Sales fell 4 percent, to $1.7 billion.

Revenues in the electronic measurements unit, which is the main focus of the company's Santa Rosa location, tumbled 17 percent during the same period, largely because the company lost a contract with a wireless manufacturer in a previous quarter. Slower defense spending in the United States also contributed to the decline, said Guy S?? president of the Electronic Measurements Group.

"All in all, I think it was a solid quarter within this environment that is extremely volatile and difficult to predict," S??said. "While orders and revenue at the company were down, we were still able to perform by being very proactive and managing our expenses."

In the defense sector, the company was successful outside the U.S., making good deals in Europe and Japan, S??said. But stateside, the ongoing sequestration has hurt the budgets of the Defense Department and the companies that serve as its vendors, he said.

Defense spending tends to increase in the fourth quarter when government agencies have to finish spending their budgets, S??said. Even so, he was cautious about the future.

"In terms of business, we expect a difficult quarter," S??said. "The same uncertainties that I mentioned are still here."

In addition, orders for testing equipment from personal computer and notebook manufacturers slowed as those companies faced increasing competition from tablets and netbooks, which require different testing technologies.

"There is a need for new tools and new ways to test them, and that's where we can come in and start proposing new solutions," S??said.

Agilent's stock closed at $46.51 per share Wednesday, down 41 cents from Tuesday. But the company's earnings per share exceeded analysts' expectations, and the stock rose about 3 percent in after-hours trading.

The tech manufacturer, with headquarters in Santa Clara, reported $6.9 billion in revenues last year. It employs 20,500 people worldwide, but announced a plan to reduce its workforce last quarter.

"We've done it in such a way that the employees were treated respectfully and fairly, and we continue to do everything we can to make sure they land on their feet," said Bill Sullivan, president and CEO of Agilent.

S??would not disclose the number of employees who were laid off in Santa Rosa, but said it was a small number. In May, Agilent reported employing about 1,175 people in Santa Rosa. The company is still reporting that same number of employees, said Jeff Weber, spokesman for Agilent.

On a conference call with investors, analysts questioned Agilent executives about the performance of the electronic measurements segment.

"Order rates are picking up, and the trough is behind us," S??said.

"If you look at their history, they historically have always come roaring back with some economic tailwinds and of course some great new products," Sullivan said. "I can't state strongly enough that we're making the right investments and we're focusing on the right products for the long haul."

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