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Tablet demand hits a wall as many are happy with the devices they own
It looks like Apple wasn't the only tech firm to see its tablet business take a hit this winter; according to IDC, others suffered a similar fate. The analyst group estimates that overall tablet shipments grew just 3.9 percent year-over-year in the first quarter, a sharp contrast with the breakneck pace of the past few years. Amazon took a particularly severe blow, as its shipments dropped almost 50 percent. So what prompted the suddenly chilly market? If you believe researchers, many are happy with the devices they've got -- they either have a good-enough tablet or a big-screen smartphone that will do in a pinch. Simply put, there was no compelling reason to splurge on something new.
T-Mobile's no-contract attitude brings in another 2.4 million customers
So, now we know where all those disgruntled Sprint customers have been going. In total, 2.4 million people joined T-Mobile USA's network in the first quarter of this year, with around half of those opting for the carrier's "Un-carrier" style plans, which do away with service contracts and instead provide straight-up financing to those looking for a new handset. Despite being reprimanded by an industry watchdog for its aggressive and not-wholly-accurate marketing, T-Mo actually managed to beat its last bumper quarter in terms of new subscribers, at a time when the other, bigger networks saw much smaller increases -- AT&T and Verizon each only added around half a million new postpaid customers last quarter, for example. Curiously, on the financial side of things, T-Mobile actually reported a drop in earnings -- which it blamed on the fact that it's having to expand so quickly. Another curiosity: If some of this growth really has been happening at Sprint's expense, then pretty soon it may not matter.
Windows Phone thrives in Europe, but struggles in China and the US
Microsoft's quest for smartphone market share is hitting a few roadblocks, it seems. Kantar estimates that Windows Phone is still gaining ground in Europe, where it's up year-over-year to 8.1 percent of sales in the first quarter of 2014. However, it's taking a bruising in other areas. In the US, Windows swung from increases this fall to a slight dip in the winter; while it's still doing relatively well at 5.3 percent of US share, it's not posing much of a threat to Android or iOS right now. The platform also took a drubbing in China, where its share was nearly cut in half to exactly one percent thanks to the rise of budget Android handsets.
Apple's iPhone sales soar while the iPad slumps slightly
It's that time again: Apple has just posted its Q2 2014 financials, and there are some interesting device sales numbers to peep at. Apple saw a big year-over-year jump in the number of iPhones sold (43.7 million this time vs. 37.4 million in the same quarter last year), thanks at least in part to a deal that brought the 5s and 5c to China Mobile -- a carrier that has over 750 million subscribers. Alas, Apple never breaks down its sales figures between models, so how many people opted for the colorful (and cheaper) 5c instead of the 5s is still a mystery. It didn't warrant a mention in the earnings release, but the company's moved 20 million Apple TVs (the hobby days are well behind it) and Mac sales surged slightly, too. The iPod did about as well as we thought... which is to say not well at all. The company sold fewer than half this quarter than it did during the same time last year, but it's no secret the venerable music players were slowly falling by the wayside. But then there's the iPad.
Netflix is going to raise prices for new customers, and come to US cable DVRs
Our latest update on how Netflix is doing is here, and buried within the earnings details the company revealed two announcements that have been a long time coming: it's raising prices for new customers, and it is (after years of rumors) going to offer service on cable-provided DVRs in the US soon. The price hike later this quarter will be for new members only and is expected to be a "one or two dollar" increase, while current subscribers will be grandfathered in at their current rates "for a generous time period." The big question for Netflix? Now at 48 million customers strong (37.5 million in the US), can it push through a price hike without the customer losses it experienced the last time it changed pricing? In January it increased prices in Ireland by one euro per month and grandfathered current customers in at their existing price for two years, and says it saw "limited impact" as a result. Netflix executives will take investor's questions live on YouTube in just a few minutes, watch here or check after the break for any interesting details.
Google earnings focus on the search and ads that actually pay the bills
With all the modular phone concepts, balloon internet projects, robots and drones it can be easy to forget Google's main business angle: search and advertising. Google reported its first quarter earnings today and didn't have much to say about our favorite topics -- we'll hear more about those at Google I/O in June -- or even its pending sale of Motorola to Lenovo. Responding to an analyst's question, Google execs Patrick Pichette and Nikesh Arora mentioned the need to "keep evolving (search) results," as it increasingly serves up info (sports scores, TV listings, restaurant menus) on its own website instead of just providing links. That's probably also behind its push for Google Now results that bring up relevant info before the user even asks, on the desktop and mobile. In a brief reference to the Chromecast, Pichette called the $35 device a hit, mentioning the over 3,000 developers had signed up to build apps since the launch of the SDK.
Death of Windows XP can't quite reverse slowing PC sales
The official end to Windows XP support may have sent many companies into a panic, but it was good news for PC manufacturers this winter... well, sort of. Both Gartner and IDC report a big increase in PC shipments during the first quarter thanks to companies scrambling to replace old XP computers at the last possible moment. However, the two analyst groups note that the sudden spike only managed to soften ongoing declines in PC shipments, rather than reverse them. Depending on which research firm you ask, the number of PCs on the market dropped between 1.7 percent to 4.4 percent year-over-year. That's better than what system builders have seen over most of the past two years, but it's not exactly a recovery.
HTC breaks sales losing streak, believes the new One will help it turn a profit
You don't need to be a financial genius to know that 28 straight months of declining year-over-year sales is not a good thing. HTC finally broke that streak this quarter, but that's the only silver lining in an otherwise dismal earnings report. While March 2014 sales were up 2.2 percent over last year, revenue for the quarter was only NT$33 billion (about $1 billion US), lower than even the company's own (gloomy) forecast. That resulted in a net operating loss that was also worse than expected. On the plus side, HTC has projected a profit for next quarter, the first that will reflect its widely lauded HTC One (M8) handset. Unfortunately, overall sales are still expected to be much lower than last year, and a shadow of the glory days of yore.
Microsoft makes $5.2 billion net profit, says Surface sales on the rise
Microsoft has just posted first quarter earnings that suggest it's faring well despite a tough PC market. Although the company's revenue was down from the previous quarter to $18.5 billion, its net profit climbed to $5.2 billion; both figures were double-digit improvements over the same quarter a year ago. The Redmond firm chalked up most of the success to growth in its corporate-focused Commercial group. Not that its Devices and Consumer division was in dire straits -- while Windows revenue from PC makers was down 7 percent, search ad revenue was up 47 percent. The Surface tablet line also saw a quarter-to-quarter increase in revenue to $400 million that was likely helped by price cuts to outgoing models. The company hasn't provided an outlook for its second quarter as of this writing, but it's easy to anticipate strong performance. Microsoft has just launched Windows 8.1, which will net $113 million in pre-order revenue (currently deferred); it could also trigger a surge in PC sales as customers upgrade. The tech giant is also launching a new round of first-party hardware during the period, including the Surface 2, Surface Pro 2 and Xbox One. It may be difficult to repeat this perfect storm of profit in 2014, but we doubt that Ballmer and crew are about to complain in the next few months.
Lenovo posts Q1 earnings, reveals that its mobile sales have overtaken PCs
Don't look now, but Lenovo just became an industry bellwether. While reporting strong first quarter results that include a record $8.8 billion in revenue and $170 million in profit, the tech giant revealed that its combined smartphone and tablet sales have overtaken those of its PCs. Yes, you read that correctly -- the world's largest PC vendor is now a mobile-first company, unlike previous title holders such as HP. It's not hard to explain the shift, however. About 42 percent of Lenovo's total sales come from its native China, where the company's predominantly Android-based phones and tablets fare very well. The firm's Windows PCs and tablets are also performing above industry averages, but CEO Yang Yuanqing makes it clear that Lenovo is quickly becoming a "PC Plus" brand -- IdeaPads and ThinkPads are just parts of a larger puzzle.
BlackBerry ships 6.8 million smartphones but loses $84 million in fiscal Q1 2014
Every quarter is pivotal for BlackBerry right now, but the one covered by today's earnings report (Q1 2014 in fiscal terms, or March through May 2013 on our calendar) is especially important. It's the first full period of Z10 availability and also the first quarter to cover significant Q10 shipments to markets like Canada and the UK (although not the US). So far, the news looks mixed, but mostly glum: revenues are up to $3.1 billion, compared to $2.8 billion generated in the same quarter last year, which was when RIM (as it was called back then) announced significant job cuts and an equally major delay to its next-gen BB10 operating system and hardware range. However, none of that cash was retained as profit, despite all the cost-cutting measures. In fact, BlackBerry managed to lose $84 million, reversing the positive shift seen last quarter when the company kept a hold of $94 million as profit. Worryingly, the press release provides no breakdown of the crucial BB10 device shipments, versus older devices. There's just a quote from Thorsten Heins saying "we are still in the early stages of this launch," which doesn't bode well -- although an imminent earnings call should provide further information. Update: Execs on the earnings call refused to break down Z10 and Q10 shipments specifically, but did say that 40 percent of the 6.8 million reported shipments were BB 10 devices -- which adds up to a disappointing 2.7 million next-gen units.
