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If history repeats itself, Apple's next three months will be amazing
More so than many large companies, Apple is a creature of habit. That's why it's easy to recommend against buying a new MacBook or iPad if history says that a new model is just around the corner. But when the company has a particularly slow stretch, like the one Apple is currently in, the doomsayers begin to ring their bells and light their fires. But after looking at the current slump in historical context, things look much different. I wanted to see just how slow Apple's recently-concluded Q2 actually was in comparison to recent years, and it pans out like this: 2011 Q1 9/26/10 - 12/25/10 MacBook Air (refresh) iLife '11 Q2 12/26/10 - 3/26 iPhone 4 (CDMA model) MacBook Pro (refresh) iPad 2 Q3 3/27 - 6/25 iMac (refresh) AirPort Extreme (5th gen) Time Capsule (4th gen) Q4 6/26 - 9/24 MacBook Air (refresh) Mac Mini (refresh) Thunderbolt Display OS X 10.7 Lion 2012 Q1 9/25 - 12/31 iOS 5 iCloud iPhone 4s iPhone 4 (8GB model) MacBook Pro (refresh) Q2 1/1 - 3/31 iBook Author iPad (3rd gen) Apple TV (3rd gen) Q3 4/1 - 6/30 Mac Pro (refresh) MacBook Air (refresh) MacBook Pro (refresh) MacBook Pro (3rd gen) AirPort Express (2nd gen) Q4 7/1 - 9/29 OS X 10.8 Mountain Lion iPod Touch (4th gen, 16GB model) iOS 6 iPhone 5 2013 Q1 9/30 - 12/29 iPod Touch (5th gen) iPod Nano (7th gen) Mac Mini (refresh) MacBook Pro (3rd gen, 13" model) iPad mini iPad (4th gen) iMac (refresh) Q2 12/30 - 3/30 MacBook Pro (3rd gen, Retina) Q3 3/31 - 6/29 iPod Touch (5th gen, 16GB model) AirPort Extreme (6th gen) Time Capsule (5th gen) MacBook Air (refresh) Q4 6/30 - 9/28 iOS 7 iPhone 4s (8GB model) iPhone 5c iPhone 5s iMac (refresh) 2014 Q1 9/29-12/28 MacBook Pro (refresh, Retina) OS X 10.9 Mavericks iWork (2013) iLife (2013) iPad Air iPad mini (2nd gen) Mac Pro (new model) Q2 12/29 - 3/30 iPhone 5c (8GB model) As you can see, Q2 2014 has been particularly barren, and anyone who follows Apple news can tell you it's a wasteland out there in terms of new products. But if you keep digging even further back in search of a quarter that resembles the one Apple just concluded, you'll find something interesting. The quarter that most closely resembles Q2 2014 is Q2 2007, which ran from December 31st, 2006 until March 31st, 2007. For the first 80 days of the quarter, Apple launched absolutely nothing. On the 81st day, the company launched a new product category with the 1st generation Apple TV. The next quarter it launched the original iPhone. We all know how that turned out. I'm not making a prediction one way or another here, but if we use history as a guide, the last horribly plodding stretch for Apple was punctuated by not one, but two new product categories -- both of which are still around today. So keep your chin up for Q3, because it might be a doozy. [Photo credit: Mark Doliner]
Facebook posts $59 million net loss in fiscal Q3, touts 1.01 billion active users
The bloom is slightly off the rose for Facebook. After a banner first post-IPO quarter, it's recording a net loss in its fiscal third quarter of $59 million despite its revenue climbing to $1.26 billion -- a big swing that the company is blaming on payroll tax tweaks and income taxes, which becomes clearer when you learn that the company posted a $311 million profit before factoring in standard accounting practices. Facebook hasn't said exactly what had the biggest impact, although its closing the Instagram deal wouldn't have helped matters. Still, the company isn't glum about its prospects: following an earlier mention of the milestone by founder Mark Zuckerberg, the earnings report touts that there are over 1.01 billion active Facebook users who check in at least once a month, over 604 million of which were mobile. Between a reworked iOS app, a freshened Facebook Messenger and new ad-friendly SDKs, the social network is bracing for a potential bonanza ahead.
Microsoft announces Q1 earnings with $5.31 billion in profit, braces for Windows 8 surge
It's Microsoft's turn at quiet-before-the-storm quarterly results, and that's evident in the fiscal first quarter earnings it just dropped on our laps. The Redmond team is reporting $16.01 billion in revenue, but a more modest than usual $5.31 billion in profit over the summer -- while it's healthier than the Q4 loss stemming from the aQuantive write-off, it's not as impressive as the $7.2 billion profit from a year ago. While a tough PC market is partly to blame, it's equally hard to say that Microsoft couldn't have done better. There's a real chance that some of its customers have been holding back on purchases in anticipation of the Windows 8 and Windows Phone 8 launches; it's already setting aside $1.36 billion in revenue for Windows and Office upgrades. The company is unquestionably preparing itself for a giant spike in demand once at least Windows 8 rolls around later this month, so we'd say that the real litmus test will be the results we get after the holidays.
RIM posts Q2 earnings: $2.87 billion in revenue, softer $235 million loss
RIM may have given us hope that its transition to BlackBerry 10 has turned a corner, but that doesn't mean the dark clouds have entirely broken just yet. The company's second fiscal quarter saw it generate $2.9 billion in revenue, a slight gain over last quarter, while it posted a net loss of $235 million -- again better than expected, but not the best news it could deliver. Waterloo's main challenge was holding on to its smartphone base. While RIM did expand the total BlackBerry user base to 80 million, its phone shipments dropped from 7.8 million to 7.4 million and were braced by shipments of just 130,000 PlayBooks, or half as many tablets as were delivered in the spring. The sunshine is mostly found in the total picture. RIM says it's still on track to deliver the first BlackBerry 10 phones in early 2013; while the smartphone maker is bracing for an operating loss in its ongoing third quarter, the higher revenue and reduced losses suggest to CEO Thorsten Heins that RIM is getting its fiscal house in order before BlackBerry 10 (hopefully) renews interest. Full details of the company's financial performance are available after the break.
NVIDIA Q2 earnings bounce back through Tegra: $119 million profit on $1.04 billion in revenue
NVIDIA's fiscal performance in its second quarter shows the rewards of patience in the mobile sphere. It just saw its profit double versus a glum first quarter to $119 million, even though the company only slightly edged ahead in revenue to $1.04 billion. In explaining the success, the company is quick to point to a confluence of events that all worked in favor of its bank account: a slew of Tegra 3 phones and tablets like the Transformer Pad TF300 made NVIDIA's quarter the brightest, but it could also point to a much-expanded GeForce 600 line on the PC side and the shipments of the first phones with NVIDIA-badged Icera chips. The graphics guru expects its revenue to climb more sharply in the heat of the third quarter as well -- between the cult hit Nexus 7 tablet and a role as a major partner for Windows RT, NVIDIA has at least a temporary license to print money.
Sega Sammy sees losses in gaming sector, StarHorse3 sales continue unabated
Sega Sammy Holdings is a ginormous company; one that, on the whole, is doing pretty well for itself, having ended the first quarter of fiscal 2013 in the black to the tune of ¥2.544 billion -- a massive increase over the ¥2.224 billion loss the company reported last year. When broken down by section, however, Sega Sammy's "Consumer Business" segment didn't fare as well as the company's pachinko/pachislot and amusement center-oriented segments.The Consumer Business division, the part of the company responsible for console and handheld gaming, posted an operating loss of ¥1.559 billion for the three month period ending on June 30, but that's actually up 59 percent from the ¥3.856 billion loss reported for the same period last year. Consumer Business shipped a total of 1.3 million units during Q1, with more units shipping to Europe (700,000) than to the US, Japan and elsewhere combined (400,000 and 230,000 respectively).Honestly, we think it'd do wonders for Sega Sammy's bottom line if they'd start selling the convertible horse racing loveseats they make for "StarHorse3 Season Ⅰ A NEW LEGEND BEGINS" (above) on their own, or license out the design to movie theaters.
RIM: QWERTY BlackBerry 10 phone launches in 'close proximity' to its all-touch cousin
RIM hasn't had much good news to offer along with its glum fiscal first quarter, but it has given a reason to mark early 2013 on the calendar if you're a BlackBerry fan. CEO Thorsten Heins revealed during the results call that the first QWERTY BlackBerry 10 phone will arrive in "close proximity" to its touchscreen-only counterpart. What that entails is still very much under wraps, although there were clues. Heins stressed that the early batch would focus on the "premium" space, while BlackBerry 7 would hold down the entry and mid-range markets until their BlackBerry 10 replacements were ready. The tidbits won't provide much comfort to someone who has to decide on a phone by the holidays, but they hint that the truly patient could be rewarded for their calm under pressure.
HP cuts 27,000 jobs, profit tumbles 31 percent in Q2
Looks like rumors of major cost-cutting measures at HP are true: the company along with its fiscal Q2 results has just outlined plans to slash 27,000 jobs by the end of its fiscal 2014. The group of affected staffers, or about eight percent of the workforce, is being offered an "early retirement" if it doesn't want to wait to be let go involuntarily. The move is intended to streamline HP's operations and save between $3 billion to $3.5 billion a year by the time the cuts are done. As for the results themselves, they explain all too clearly why the cuts are inbound: HP 's profit dropped a massive 31 percent to $1.6 billion, and its revenue dropped three points to $30.7 billion. CEO Meg Whitman touted the results as exceeding an earlier glum outlook, but with the enterprise, printer and services groups all dragging the company down, it's clear that HP is in the same boat as a struggling Dell.
MetroPCS announces Q1 2012 results: total revenues up, new subscriber growth shrinks
Regional network MetroPCS has announced total revenues of approximately $1.3 billion for Q1 2012, up from $1.2 billion in the last quarter and up seven percent from the same period in 2011. Users on contract now total 9.5 million, with 16 percent of them making the move across to a smartphone. Net income has, however, dropped 63 percent since Q1 2011, with cost per user up 16 percent compared the same period last year. MetroPCS puts down to "retention expense" and the roll-out of its 4G network. The fifth biggest US carrier added over 131,000 new subscribers, but growth continues to slide -- it's down from 190,000 in Q4 2012. On the positive side, users are creeping onto the carrier's 4G network, with 580,000 LTE subscribers nowmaking up six percent of its total subscription base -- regardless of those creeping costs for unlimited data.
MetroPCS Q4 results are in: increased revenue, slowing growth
The nation's fifth largest wireless provider -- MetroPCS -- has checked in with its Q4 2011 financials, and on the whole, the company looks to be doing quite well. Metro reported $1.2 billion in consolidated quarterly revenues and $362 million in earnings, an increase of 16% and 15% when compared to the fourth quarter of 2010. A few other positive vitals: average revenue per user (ARPU) was up $0.76, net income rose to $77 million and churn dropped 80 basis points from 4.5% in Q3 to 3.7% in Q4. Two small blemishes can be found in the net customer additions and cost per user (CPU) columns. While MetroPCS added well over 197,000 new customers in Q4, the rate at which it grew slowed dramatically -- down 34% when compared to the fourth quarter of 2010. The company's CPU also rose $1.17 during that same period -- which can be partially attributed to LTE network services, along with general expansion and operating costs. One other mildly unfortunate note was word that voice over LTE wouldn't be launching till the second half of the year, slightly later than we had been anticipating. Taking all that into consideration, it was still a strong quarterly showing from the value-centered wireless carrier.
Sony's Q3 earnings are in: wider than expected full year loss, lowered sales projections
Sony already revealed Kazuo Hirai will take over for Howard Stringer as CEO and President April 1st last night, and with the big shocker out of the way it's time for the fiscal Q3 reports. After posting a net loss of $346 million last quarter, Sony is now expecting a bigger loss for 2011 than it had previously estimated, as well as lower sales. It's currently showing a net loss for the quarter of 159 billion yen ($2~ billion), or a $1.2 billion operating loss. Blame is put on a larger than expected effect from the flooding in Thailand, strong yen and weakness in cellphones. Sales for the quarter were about $23 billion, down 17.4 percent from the same quarter last year. The consumer products and services division (HDTVs, PS3s, etc.) in particular caught a brick, with an operating loss of over a billion dollars on sales that dropped 24 percent from last year. It recorded a loss on its sale of shares in the S-LCD venture with Samsung, LCD TVs sold for prices lower than its cost reductions, and the PlayStation 3 had the killer combo of higher marketing costs and lower unit sales. Check the PDF and slides linked below for more bad news. We'll let you know what we hear on the earnings call in a few, but until then, Kaz, may we suggest bringing in Jimmy Rollins for tips on breaking out of a slump?
Barnes & Noble's Q2 earnings reveal Nook to be a $220 million business, Nook Tablet said to be fastest-selling yet
Barnes & Noble's second quarter earnings weren't all good news for the company -- it reported a net loss of $6.6 million and an ever-so-slight dip in total sales from $1.90 billion to $1.89 billion -- but it did have a fair bit to boast about on the technology side of things. Sales on its B&N.com website increased 17 percent year-over-year, totaling $206 million for the quarter, and the value of the company's Nook business (including devices and content) now stands at $220 million, up a full 85 percent. The company also revealed that its new Nook Tablet has been the fastest-selling Nook device to date, although it's not providing any specific sales numbers, noting only that it expects to sell "millions of devices" during its third quarter. Additional figures can be found at the source link below.
Dell's Q2 earnings fall short of estimates: $890 million net income, $15.66 billion revenue
Shares of Dell were down nearly eight percent in after-hours trading after the Texas-based PC maker posted lower-than-expected second-quarter results. Still, the company's revenue was up one percent over last year, totaling $15.66 billion, compared to $15.5 billion in Q2 2010. Net income jumped 63 percent, from $545 million to $890 million, over the year-ago quarter. Corporate and government orders were responsible for the jump in income, according to an AP report, but new sales predictions hint that orders may not be coming in as often as anticipated. Dell expects modest growth of one to five percent for the full year -- citing "a more uncertain demand environment" -- compared to previous estimates of five to nine percent growth. Jump past the break for the full rundown from Dell.
Qualcomm reports record quarterly revenues, boasts 100th Snapdragon device
Qualcomm's back again with yet another set of impressive numbers. For the second quarter of this fiscal year, the chip giant saw record earnings of $3.88 billion, up 46 percent from the same quarter in the previous year, and collected $999 million of sweet profit which is a 29 percent jump from last year. This is no doubt to do with the 70 percent increase in the MSM7000- and MSM8000-series Snapdragon shipments in this half of the fiscal year (compared to 2H 2010), and it should be noted that this quarter also saw the 100th Snapdragon-powered device announced by a Qualcomm client. Additionally, EVP Steve Mollenkopf reassured us that the recent events in Japan won't have any significant impact on upcoming shipments, so the 30 Snapdragon tablets in the pipeline should arrive as scheduled. Excerpts from the financial report can be found after the break.
Sony posts $887 million net profit, PlayStation has strong holiday quarter
Sony had quite a good holiday during its third quarter for fiscal year 2010, posting a ¥137.5 billion (approximately US $1.68b) operating income. Year-over-year, however, it's actually six percent lower than Q3 FY09, with some blame attributable to a five percent stronger yen. Although sales were more or less the same in most divisions (with pictures and music seeing a more noticeable drop), operating income saw dramatic changes. Consumer, Professional and Devices dropped 47 percent to ¥26.8b ($327.3m), while Networked Products and Services (which includes the PlayStation brand) jumped a whopping 134 percent to ¥45.7b ($559.78). Looking at unit sales, Bravia sets were way up (7.9m units versus 5.4m in Q3 FY09), and video cameras, compact digital cameras, and PCs all saw moderate gains. PSP hardware took a pretty big hit, going from 4.2m last holiday to 3.6m this past quarter (the now-profitable PlayStation 3 saw a slight decline, 6.5m to 6.3m). Software-wise, though, both gaming machines saw a bump -- 57.6m (from 47.6m) for PS3 and 16.4m (from 15m) for PSP. The PlayStation 2, now almost 11 years old, actually had about the same 2.1m hardware unit sales YOY, though software took a pretty hard hit (from 11.2m to 5.3m). Sony's golden years console isn't going down without a fight -- then again, it might've been a different story had the company managed to add backwards compatibility to the PS3.
Dell's Q2 2010 sees 16 percent increase in net income, flat revenue from Consumer unit
First with HP, and now with Dell. The PC maker (and occasional phone dabbler) posted its second quarter fiscal 2010 report, which actually gives a good perspective on the relative position of each company in the global PC market. Whereas the House that Hurd once ran reported a $30.7 billion revenue and $2.3 billion operating profit, Dell posted $15.5 billion (up 22 percent) in revenue and $745 million operating income. Like we said earlier, operating income shouldn't be confused with net income, which deducts those massive corporate taxes. Looking at net, the company profited $545 million, up an impressive 16 percent year-over-year. Focusing on the Consumer unit, revenue was flat at $2.9 billion, while at the same time operating income incurred a $21 million loss. According to the press release, the company "remains confident that initiatives underway will improve operating margins for the segment." Is all this enough to quell irate shareholders? Chances are slim, but hey, it's a start.
Sony's PlayStation division sees sales increase, still operating at a loss
As analysts predicted, Sony finished the first quarter of its fiscal year (ending June 30, 2010) with a net income of ¥25.7 billion ($295M), a significant increase from the ¥37.1 billion ($426M) loss during the same quarter last year. Overall, sales were up 3.8 percent year-over-year to ¥1.7 trillion ($18.7B). Compared to the same time last year, the division that houses the PlayStation brand is in a much better place, even though it still operates at a loss. While sales increased 32 percent this year to ¥326 billion ($3.7B), bumped up by PC and PlayStation 3 hardware and software, the division had an operating loss of ¥3.8 billion ($43 million) -- a vast improvement from the ¥36.7 billion ($422M) loss last year. The company expects hardware sales of the PS3 to continue increasing this year and software sales to remain flat.
PS3 and Bravia sales boost quarterly Sony profits above expectations
Earlier this summer, Sony closed another fiscal year of being in the red, but it's starting the 2010/11 ledger with its quill dipped firmly in the black inkwell. For the quarter ending June 30, the Japanese megacorp clocked up ¥25.7 billion ($293 million) in pure, unadulterated profit off the back of a ¥67 billion operating income. When you compare that to the performance this time last year, a ¥37 billion loss, you have to agree that the Stringer purse-tightening program seems to have delivered the desired effect. The primary drivers for the current resurgence are pinpointed as the PlayStation 3 and Bravia lines (frankly, we consider the two utterly inseparable), and Sony's feeling so buoyant about it all that it's revising its projection for the coming year's revenues upwards today. The good news is tempered, however, by the threat of a rising Yen, which has already claimed Nintendo's profits as its first victim.
Nintendo posts Q1 loss on strong Yen and lower DS prices
Although foreshadowed, it's hard to believe that the once mighty Ninty, a company with unshakable profits even during last year's global economic downturn, just recorded a Q1 net loss of ¥25.22 billion ($288 million) compared to a net profit of ¥42.32 billion during the same 3-month period a year earlier. Revenues dropped from ¥253.50 billion to ¥188.65 billion. Lower DS portable gaming machine prices coupled with a strong Yen (86.5 percent of its sales were outside of Japan) helped pull Nintendo into the red. Regardless, Nintendo continues to forecast a full year net profit of ¥200 billion on revenue of ¥1.4 trillion. We'll see.
Kin listed as at least $240 million writeoff in Microsoft earnings report
Here's a tidbit in today's Microsoft quarterly earnings that we previously overlooked: a $240 million cost of revenue "primarily... resulting from the discontinuation of the Kin phone, offset in part by decreased Xbox 360 console costs." In other words, the company took at least a quarter billion hit due to manufacturing, distribution, and support costs of the Kin (according to Microsoft's definition of "cost of revenue"). We don't know how much Xbox 360 offset, unfortunately, but we can add this figure to the $500 million Danger acquisition and the full marketing cost for the product (which we also don't know, but anecdotally, it was on par with other major campaigns) to reach... well, at least $800 million in regret for the folks in Redmond.
