Tech Earnings Picks and Pans

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Includes: AAPL, ADTN, AMZN, CALX, MSFT, NFLX, YHOO
by: R. Scott Raynovich

It's a week of lots of technology stock earnings, and what's striking is the range of results, from earnings disappointments such as Netflix, and Amazon, to solid efforts from blue chips Apple and Microsoft.

We've been following many of the companies, here are the takeaways:

Winners

Apple (OTC:APPL): Of course Apple crushed it again! Predictable.

The company earned $3.51 per diluted share in fiscal 2010's third quarter, an increase of 74 percent over the $2.01 Apple made in the same quarter of 2009. The revenue number of $15.7 billion blew away the guidance of $13.4 billion. Let's face it, Apple's a money machine. The only question now is whether iPhone 4 antenna problems will weigh on another record quarter.

The stock initially ramped about 10% on Wednesday but it's come back in since.

Microsoft (NASDAQ:MSFT): The grandaddy of tech reported fourth-quarter profit of $4.52 billion, or 51 cents a share, compared with the 46-cent consensus. The company sold more software with sales of more personal computers running the Windows operating system. Sales rose 22 percent, the most in more than two years, to $16 billion. This confirms the thesis that the PC market is back on track and corporations are spending on technology again.

What happened with the stock? The market yawned. Microsoft shares traded down 0.34 (1.32%) this morning.

Adtran (NASDAQ:ADTN) & Calix (NYSE:CALX): These companies are both benefitting from a broadband buildout. The big difference is that Adtran is a larger, profitable company and Calix is relatively young, with a recent IPO.

Adtran announced quarterly Earnings Per Share (NYSEARCA:EPS) of .44, whereas consensus expecations were for .35. The stock was recently at new 52-week highs. Calix, meanwhile, recently reported the first quarter after its IPO. The loss was smaller than expected and revenue ramped 50% from the year-ago period, causing the stock to rally 10%.

Bombs

Netflix (NASDAQ:NFLX): The company beat on the profit side, reporting 80 cents per share compared with 54 cents per share in the year-ago period. Consensus expectations were for 70 cents per share. But concerns about marketing expenses and revenue weiged on the stock. Average Revenue Per User (ARPU) was down, causing investors concern.

On Thursday, the stock was hammered for 14%.

Amazon (NASDAQ:AMZN): Another high P/E stock, like Netflix, which was hammered when investors saw something they did not like. Amazon reported net income of $207 million, or 45 cents a share, up from $142 million, or 32 cents a share a year earlier. Problem was, the Street was expecting 54 cents. Big miss. Revenue was $6.57 billion, up from $4.65 billion in the last last year.

The stock got whacked hard after hours on Thursday, and looks like it will trade down (as much as 12%) on Friday, primarily based on concern over higher expenses and the earnings miss.

Yahoo (NASDAQ:YHOO): Yahoo simply can't get it together for a rally. Yahoo announced earnings of $213.3 million, or $0.15 per share, compared to $141.2 million, or $0.10 per share, in the same quarter last year. This actual came in slightly about analyst expectations, but the revenu number, $1.13 billion, fell short.

Yahoo plunged about 10% on Wednesday. Much of the fall might be attributed to dialed-back guidance, as executives on the conference call said advertisers were scaling back plans.



Disclosure: The author was short AMZN as of this writing