While our base case scenario envisions pricing declines to level off due to the growth of the smartphone segment that should offset the downward pricing pressures, we assess the downside risk here in the event that the current rate of pricing declines continue into the future.

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Martha Stewart Living is trying to fatten merchandising revenue as it struggles to offset declines in its broadcast and publishing business, a segment that accounts for more than 60 percent of its total business.

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The company noted that a 6% rise in revenues in its services business was offset by a 7% decline in revenue in the technology segment, which includes document systems and related products.

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However, a closer look at segment performance revealed weak Windows revenue and profit, which were offset by stronger results in the Business Division (which sells Office) and Server and Tools (the enterprise part of the company).

FORBES: Parsing The 2Q11 Tech Earnings Results

Although Heidelberg dominates the traditional offset commercial printing market, Xerox leads the fast-growing digital-production color segment with a market share of 55%.

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The weakness in the PC segment will likely show up when Dell and Hewlett-Packard (HP) report during their offset cycle.

FORBES: Parsing The 2Q11 Tech Earnings Results