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Lenovo continues to struggle as a smartphone maker
Lenovo has published its earnings for the fourth quarter of the 2017/18 financial year, and the results are... mixed. One of the report's biggest headlines is that the company posted its fastest pace of revenue growth in more than two years, thanks largely to signs of life from its PC arm -- revenue here climbed 16 percent to $7.7 billion during the quarter. Lenovo currently holds the unenviable title of world's worst performing technology stock, so it's clearly keen to tout this figure, and indeed, the company's shares climbed as much as 4.4 percent after it published the results.
Samsung sees its lowest profit in two years as smartphone sales languish
When Samsung took the time to update investors ahead of its upcoming quarterly earnings report, it warned 'weak demand' for phones and an increased marketing spend could hit the company hard. That report hit today, and it's as bleak as the company expected. In its second quarter, Samsung posted profit of 6.25 trillion won ($6.1 billion), down from 7.77 trillion won ($6.96 billion) last year, its lowest quarterly profit in two years. Smartphone sales contributed the majority of its revenue, but the Samsung's flagship phone, the Galaxy S5, languished as the iPhone continues to fly of shelves and Chinese brands cut directly into its low-end business.
Losses, write-offs and pay cuts: It's just a regular day at Acer
Acer executives are having a gloomy time of it after suffering a huger-than-expected financial loss for 2013 and subsequently being forced to take a 30 percent pay cut. Despite launching a wide range of PCs and tablets last year, the Taiwanese manufacturer lost around $700 million (NT$21 billion), including a last-minute write-down on "raw materials" that apparently escaped being turned into electronic devices that no one wants. Judging from the company's showing at CES earlier this month, which revealed an interesting new focus on Android, but in many cases still failed to match up to rival manufacturers (compare Lenovo's Android all-in-one with Acer's, for instance), it looks like the company has yet to change its ways -- despite repeatedly changing its CEO.
Perfect World ends the quarter strong, looks to Dota 2's China release
Perfect World Entertainment, the China-based publisher behind games like Perfect World International, Neverwinter, Star Trek Online, and Champions Online, ended the last financial quarter in a strong place. Citing the Chinese release of Swordsman Online and Saint Seiya Online as driving factors, Perfect World claimed $136.2 million in revenue and $19.8 million in net profit -- up from last year's marks of $114.2 million and $14.2 million respectively. Perfect World also expressed its hope for even better quarters to come thanks to big launches in the pipeline. It is currently localizing Neverwinter for a Chinese release and will be overseeing Valve's Dota 2 as it makes its way into Chinese markets.
Lenovo sells a record four devices per second as phone and tablet demand soars
In stark contrast to Dell, with its corporate upheavals and hygiene issues, Lenovo's business is still booming. The company sold a record 29 million devices last quarter and saw double-digit rises in revenue and profit -- a level of growth that almost makes it seem like it has stepped out of the stagnant PC market and into something illegal. What's actually happening, however, is healthy and continuing diversification: unit sales of smartphones and tablets overtook PCs back in the summer, and now, when combined with smart TVs, account for 15 percent of Lenovo's revenue -- versus eight percent a year ago and just four percent the year before that. With the company's regular PC trade also in good shape, snatching nearly an 18 percent slice of that traditional market, it's perhaps a shame that the company has reportedly been prevented from expanding even faster.
T-Mobile's UnCarrier plans help to attract a million more customers
It looks like T-Mo's efforts to stand out from the carrier crowd are continuing to have an impact. The US operator claims it attracted a million new customers in Q3, following the 1.1 million people who joined its network over the summer. The company attributes this success largely to its UnCarrier plans, including Simple Choice and Jump, which it says are starting to "resonate" with consumers. Then again, rivals AT&T and Verizon have reported similar lifts in popularity last quarter, so one could also argue that T-Mobile is just keeping pace with the rest of the pack -- with the notable exception of Sprint, whose subscriber base is shrinking.
Verizon celebrates Vodafone split with a million new subscribers
Verizon's third quarter results are out, and it's not suffering any malaise after its break-up with Vodafone. In fact, it landed 1.1 million new mobile customers and over 300,000 new subscribers to its FiOS internet and video services during the three-month period. More than 67% of people on the carrier's books are now rocking smartphones, some of which will be handsets that joined the LTE line-up this quarter, including the HTC One, Motorola's new Droids, the iPhone 5s and 5c, and most recently, the Galaxy Note 3. In its wired business, the number of FiOS video customers grew to 5.2 million, up 12.6 percent from last year as the company also promised more live channels on the way for its mobile app. In total, Verizon took $5.6 billion in profit (a whopping 30 percent more than in Q3 2012) from $30.3 billion in revenue. It's not a huge increase over last quarter's success, but we doubt the head honchos care too much about growth when looking at that many zeros.
Nintendo reports quarterly revenue down, only 160,000 Wii U consoles sold
Nintendo has just revealed its consolidated results for the April-June quarter, and they show a significant 3.8 percent decline in sales compared to the same quarter last year -- despite (or perhaps because of) the release of the semi-next-gen Wii U. This console sold just 160,000 units during the quarter, or less than half the number of units shifted between January and March. The company's original sales projections for the device, and its hope of selling nine million units by March 2014, are now a distant dream -- we're looking at a lifetime total of just 3.61 million sales. On a more positive note, however, it still managed to sell a million Wii U games, and 1.4 million 3DS handhelds. In addition, the year-over-year fall in revenue was much smaller than the one Nintendo suffered in Q2 2012, and its operating loss was much smaller too -- just under five billion yen in the red. Factoring in all the company's various sources of income, it managed to eke out a net profit of 8.6 billion yen, or $88 million, so there's some life in this playful old outfit yet.
HTC: the One is selling better than last year's hero products, but next quarter may see a loss
HTC's unaudited results for Q2 2013 showed a sign of hope, but in today's call for the Q3 guidance, the Taiwanese company expects next quarter's revenue to be in the range of $1.67 billion to $2 billion, with an operating profit of anything from $0 down to... well, a margin of -minus 8 percent, which would equate to a horrible loss. This is also a notable drop from last year's $2.4 billion revenue and $168 million operating profit. CEO Peter Chou blames this decline on the higher cost structure (bill of materials and operating costs) and the clearance of aged inventory in the channel, but he hopes that Q3 will be the bottom in terms of HTC's profitability. CFO Chialin Chang added that his team has a few actions in place to help restore the company to profitability very soon.
Amazon hit by surprise loss last quarter, despite 22 percent rise in sales
The retail game is all about scraping a living out of tiny margins, and nowhere is that more evident than in Amazon's latest financial report. The company managed to grow revenue by 22 percent year-over-year between April and June, to $15.7 billion, and yet it confounded analysts' predictions by making a loss of $7 million, versus a $7 million profit in the same quarter last year. Then again, this knock has been attributed to the fact that Amazon is pushing to expand beyond the retail game, by investing heavily in its Kindle business, digital downloads and streaming products, as well as in building a bigger presence in China. This has been the strategy for a while, of course, and it's not the first time the company has been pushed into the red as a result. But Jeff Bezos says that Amazon's top ten bestselling products last quarter were all either Kindles, accessories for Kindles, or digital content for Kindles, which suggests the transformation is steadily having an impact, even if it's proving expensive.
ARM sees more double-digit growth in Q2 2013, takes big hit from patent litigation
This UK chip designer is accustomed to steep growth in demand for its Cortex mobile processors, and although we've seen hints that it faces new challenges ahead, for now it's mostly all gravy. Revenue in Q2 2013 soared 26 percent year-over-year to £171.2 million ($264.3 million), while profit before tax was up 30 percent £86.6 million (in "normalised" terms). Mobile devices remain the largest market for the company, but embedded devices (including wearables, Raspberry Pi and printers) is the fastest growing segment, expanding by 25 percent in the last year. The future continues to look rosy for ARM, with new Samsung Exynos 5 chipsets arriving based on ARM's Cortex-A15 and Cortex-A7 cores in big.LITTLE configurations. The only hint of negativity in the earnings report was a huge expense of £41.8 million incurred by a patent attack from an unnamed "third party", which was probably MIPS (see More Coverage), and which contributed to a much lower IFRS profit of £15 million -- although this represents ARM's contribution to a "full and final settlement," which presumably means it's a one-off thing.
Verizon smartphone revenue up in Q2 2013, half of all 7.5 million activations were iPhones (updated)
Verizon's latest quarterly report reveals a carrier chugging along nicely, thank you very much. Total revenue (including wireless and wireline) is up slightly to $29.8 billion, while wireless service revenue on its own grew by 8.3 percent compared to the same quarter last year. Nearly a million (941,000) new retail postpaid customers joined the VZW brigade, some of whom may have been drawn to the carrier's expanding LTE service, which is now available to 301 million Americans, as well as to new handsets like the Nokia Lumia 928 and possibly even the BlackBerry Q10 (or maybe not). In any case, those high-margin subscribers helped to increase profit by 14 percent -- so long as you're the kind of person who's content to be guided by "non-GAAP consolidated adjusted earnings per share." There's also no sign of the pension-related issues that affected the company last quarter, which leaves this carrier high and dry, regardless of how smartphone saturation may be affecting others along the food chain. Update: In its earnings call, Verizon added that 59 percent of traffic on its network is on 4G LTE, and 52 percent of its smartphone activations (around 3.8 million device activations) were iPhones.
Nokia reports smaller $150 million loss in Q2 2013, Lumia sales up to 7.4 million
After BlackBerry's disastrous earnings a couple of weeks back, Nokia and Microsoft have clear bragging rights over third place in the ecosystem war -- but does a bronze medal earn you any cash? The Finnish manufacturer has reported declining Q2 2013 revenues of €5.69 billion ($7.4 billion) compared to the $9.2 billion earned in the same quarter last year. The good news is that the huge financial losses of 2012 seem to be gone, with today's reported loss standing at just €115 million ($150 million), all of which can be laid at the feet of Nokia's devices and services division. Meanwhile, the company's smartphone sales seem to be growing thanks to fresh Lumia models like the 520, 620 and 720 -- with a total of 7.4 million Windows Phone 8 devices sold in the quarter. For context, that's significantly more than the 6.8 million units BlackBerry could boast in its latest report. It's also a big improvement on the 5.6 million in Lumia sales from Q1 and the 4.4 million sold in Q4 2012. However, the Asha division saw sales slip down from 5 million last quarter to 4.3 million now. Oh, and if anyone's still in the market for a Symbian handset, better be quick -- the company is reporting that sales of the phones are now "approximately zero." In other parts of the business, "Here," Nokia's renamed mapping division, lost €89 million ($116 million) while Nokia Siemens Networks made a slender €8 million ($10.4 million) profit. Looking forward, the company has said that it's lowering its future estimates by two percent, saying that dwindling demand, higher operating expenses and "the macroeconomic environment" will all help to erode the company's cash reserves. But hey, at least Microsoft's still kicking in that $250 million in alimony platform support payments.
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.
Tim Cook: We should have waited until 2013 to release new iMacs
During Apple's earnings conference call on Tuesday, CEO Tim Cook fielded an analyst's question regarding Apple's product releases during the Fall 2012 quarter and delivered a surprisingly candid answer. Addressing the shipping delays that plagued Apple's new iMacs, Cook articulated that Apple should had waited to release its new iMac models until this year. "I don't spend a lot of time looking back except to learn from it," Cook explained. "If we could run it over, frankly, I would have announced the iMac after the turn of the year. We felt customers had to wait too long for that specific product." Cook explained that despite supply constraints for the iPad mini, he would not have changed its release date, because they were still able to get the device out to millions of customers. While supply problems for new Apple products are not uncommon -- the company tends to push its contract manufacturers and component suppliers to their limits in pursuit of "insanely great" devices -- the shipment delays associated with Apple's recent iMac refresh were atypically long. Since its release in November, Apple struggled to keep up with demand. For quite some time, shipping delays for the all-in-one desktop computer stretched for as long as three to five weeks. It wasn't until early March that Apple seemed to get a grasp on production issues, resulting in a much more reasonable shipping time of just one to three business days. Apple is always keen on pushing the envelope in terms of manufacturing processes, and it's suspected that Apple's iMac supply issues were rooted in a new lamination process used to keep the new iMac screen as thin as possible.
HTC pays price for One delays, reports worst quarterly profit so far in Q1 2013
Instead of reaping the rewards of putting out a lovely new flagship, HTC has just reported its lowest ever profit -- a mere $2.8 million in unaudited net income -- during the first three months of this year. That compares to $173 million in the same quarter of last year, representing a pretty catastrophic fall of around 98 percent. Underlying revenue dropped by a third to $1.4 billion. The reason? The top-end smartphone on which the company's fortunes currently rest, the HTC One, mostly missed its scheduled global arrival date in March due to manufacturing delays, so it effectively didn't exist during the period in question. It has only just become available to pre-order in the US and won't start shipping to customers until April 19th. At this rate, the HTC First -- the manufacturer's second big announcement of the year -- might actually deserve its name.
Tesla's Q4 2012 earnings: $90 million net loss, but forecasts a profit for Q1 2013
If you're one Elon Musk, you're probably ready for just about anything to take the place of the only story dominating the Tesla tagline for the past few weeks. Of course, a $90 million net loss isn't the ideal story to overtake the Model S kerfuffle, but hey -- at least the company's aiming to pull in a profit next quarter. In a bid to keep investors focused on the positive, the automaker's Q4 2012 shareholder letter notes that Tesla is officially predicting its first quarterly profit in Q1 2013, sliding up from "late 2013." For the quarter that just wrapped, the firm saw revenues of $306 million (a 500 percent increase sequentially from the $50.1 million seen in Q3 2012), and it ended the year with $221 million in total cash after having made the first quarterly principal payment of $12.7 million to repay the loan to the U.S. Department of Energy. Tesla also plans to deliver some 20,000 Model S vehicles in 2013, with around 4,500 of those happening in Q1. Europeans and Asians can expect their deliveries in "summer" / "late this year" (respectively), with the first Model X deliveries to occur in early 2014. Musk also told investors that it plans to "spend significantly less on capital expenditures" in 2013 compared to 2012, helping to (hopefully) generate "slightly positive net income on a non-GAAP basis" in Q1 2013.
Disney Interactive was Disney's least profitable branch in Q1 2013
Despite revenues of $291 million during the three month period ending December 29, 2012, Disney Interactive's remaining $9 million in operating revenue (read: pre-tax profit) made it the entertainment giant's least profitable division during the first quarter of the fiscal 2013.Still, this was a marked increase over Disney Interactive's Q1 2012 performance, where it posted a loss of $28 million. Being back in black is even more impressive when you consider Interactive's reported an operating loss of $42 million just last August, making it Disney's only unprofitable sector at the time. Disney attributes this year's growth to improved performance in its social gaming businesses in the Japanese market, where a new licensing agreement has increased the amount of Disney-branded hardware and software.Of course, Disney's financial report made no mention of Junction Point or its sordid fate, but that's to be expected since the studio's closure technically happened during the second quarter of fiscal 2013. We may gain some new insight into that situation during the next round of quarterlies, but for now, all we've got to go on is Mickey's increasing popularity in the Land of the Rising Sun.
Panasonic remembers how to make money, reports $667 million profit last quarter
Just as Sharp offered a slightly more hopeful glimpse at its balance sheet this morning, so too does Panasonic have something worth celebrating: a net profit of 61.4 billion yen ($667 million) in the last three months of 2012. Much of this profit stems from a weaker yen and previous cost-cutting exercises, however, rather than any surge in demand for Panny products -- in fact, underlying sales continued to slip, with cameras, TVs and Blu-ray recorders proving especially hard to shift. Nevertheless, compared to the meager $164 million Panasonic made at the start of 2012, or the ego-crushing $2.1 billion net loss it suffered in the last three months of 2011, no one in that big HQ is likely to be complaining.
Sharp expects to post $1.94 billion operating loss for the year, score a meager Q2 operating profit
Sharp hasn't quite laid out its Q2 2012 financials, but it has laid down some bittersweet projections. According to Reuters, the Japanese firm hopes to post an operating profit for the current term, but will take a $1.94 billion loss for the year as a whole. This prediction is a tad more dismal then its earlier forecast, which predicted a $1.25 billion loss for 2012. The TV maker also cut its predicted net loss from ¥240 billion to ¥450 billion ($5.6 billion). Sharp still is hoping its cuts, layoffs and mortgages weren't in vain -- and a short term profit for Q2 could be all it needs to vindicate the $4.6 billion loan it took out in September. Sharp also said it was penning in $1.1 billion for restructuring expenses in Q2, hopefully helping it stay on track for its 2014 profitability goal.
