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R. Scott Raynovich
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R. Scott Raynovich is an internationally recognized expert in technology, telecom, and investment markets. He has been quoted in publications including Reuters, Dow Jones, Barron's, and the San Jose Mercury News. He has also been interviewed on CNN and National Public Radio. From 2000 to 2008,... More
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  • Analyzing Barry Diller's Crazy Pay Numbers
    The Wall Street Journal was out with it's decade-long pay survey this week, and I was shocked to find that Barry Diller is #2.

    Barry Diller's companies, IACI and Expedia (an IACI spinoff), are worth collectively $10B. Diller was paid 1.14B over a 10-year period, according to the Journal.

    In an interview with the Journal, Diller pointed out that most of his gains came from stock excercised earlier in the decade from deals he did in 1990s to build his company. Fine.

    But $1B? This amount of pay seems egregious, when measuring the value created by his company and comparing it with others. Let's compare it to others in the list.

    Larry Ellison, who founded Oracle, made $1.8B. But Oracle is worth $120B in market cap, more than 10 times as much as IACI and EXPE combined. Just to put things in perspective, Oracle generates cash flow of $8B per year, so Ellison was actually only paid a fraction of one year's cash flow over a decade.  IACI is currently losing money. In fact, it hasn't had a net profitable year for shareholders in the last three!

    Now, onto Apple. Through a massive stock option swap mistake, Jobs gave up a lot of stock in Apple early in the decade, and that's a big reason why he only shows a $743 million gain. But when you campare it to IACI and Diller's $1.14B package, it makes Barry Diller look ridiculous. Steve Jobs has created incredible amounts of value for shareholders. Apple's market cap is now in excess of $200B. It's up more than 1,000% from 2000. Yet, Steve Jobs made only $743 million, significantly less than Diller.

    Barry Diller tried to explain why he was worth it to the Wall Street Journal. I'd like him to explain it to me.


    Disclosure: no positions
    Jul 27 1:14 PM | Link | Comment!
  • Apple Earnings Recap in Less than 60 Seconds

    Apple announced earnings last night and it blew away the expected numbers. The company beat earnings per share (NYSEARCA:EPS) estimates by almost $1.00. Shares rallied hard today on the news, up nearly 6%.

    EPS of $3.33 beat consensus estimates of $2.45.  Revenue was $13.5 billion vs. $12.04 billion consensus estimates, and a 49% increase over the prior March quarter’s results.

    The company sold record numbers of Macs indidcating that newer products such as the iPhone and the iPad are adding to the overall strenght of the Mac platform. Mac sales were up 33% from the prior year.

    Some other quick facts from the call:

    • The company had a smaller sequential revenue decline from the December to March quarters than normal, which demonstrates how strong the quarter was. Usually December is the strongest quarter from holiday sales.
    • Operating margin was $4 billion representing 29.5% of revenue. Net income of $3.1 billion was up 90% over the year-ago quarter.
    • Guideane for the June quarter: $13-13.4 billion in revenue compared to $9.7 billion in the June quarter last year. Company expects the gross margin  to decrease to 36%  from 41.7% in the March quarter reflecting increased stock-based compensation expense.
    • Apple sold 2.94 million Macs, a record for the March quarter. This represents 33% year-over-year growth.
    • Sold 10.9 million iPods, about equal to the 11 million sold in the year-ago quarter.
    • 8.75 million iPhones sold during the quarter, an all-time high exceeding the previous record set in the December quarter.
    • The company now holds cash plus short-term and long-term marketable securities totaling $41.7 billion at the end of the March quarter compared to $39.8 billion at the end of the December quarter, an increase of $1.9 billion. Cash flow from operations was over $2.3 billion.


    Disclosure: no position
    Apr 21 4:19 PM | Link | Comment!
  • What's Hot in Mobile

    LAS VEGAS — There is plenty of excitement in the halls and aisles of the trade-show floor at the CTIA show where serious innovation and is happening around the growth concept known as the mobile consumer:

    New location-based mobile apps, 4G, mobile commerce, unified communications, and even such staid telecom technologies such as fiber and mobile backhaul are all being lifted by the increasing mobile data traffic. 

     

    Sprint and HTC were omnipresent with the biggest news of the day yesterday: The HTC EVO 4G smartphone, which has definitely raised the bar as the first mainstream broadband mobile device. The only disappointment there is that Sprint and HTC have hedged their bets on its release and the price: It will be available sometime “this summer,” while the price is still unknown.

    Other trends:

    Visual search. Don’t feel like typing? Search with your camera. I especially dig Goggles, released by Google last December. iPhone now has its own visual search app, too. Blend the ability to do visual search with location-based services, and the possibilities boggle the mind. The system will magically know when you’re in the neighborhood and you’re thirsty or hungry.

    Mobile Backhaul: I’ll have a full report on this later, but the data deluge by new higher bandwidth mobile devices should boost equipment and service providers whoe can help backhaul data off of cell sites. Did you know, for example, the most of the mobile backhaul infrastructure is still trapped in the low-bandwidth copper wire world? That’s going to change quickly.

    Mobile Advertising: The market is young, and service providers, retailers, and content companies are waking up to the revenue opportunity. Google’s  acquisition-in-progress, AdMob, has some new SDKs for iPhone and Android.

    Android Devices and Apps: They are gathering steam. Most people I talked to at CTIA said it was great to have an app platform other than iPhone to talk about.  In addition to the HTC EVO discussed above, other manufacturers are rolling out new Android devices. Samsung announced a pretty cool little Android device.

    Location-based Services: Scott McNealy famously said your privacy is gone. He’s right. Everybody’s tracking everybody on their device these days.  Social-networking site FourSquare is taking advantage of that, but Twitter is now adding location services and Facebook can’t be far behind. Of course businesses are thinking about how to engage consumers with location services as Google says that one-third of all searches have a location-based element. Companies such as TCI are developing new ways to integrate location services into mobile systems.

    That’s what I’ve seen so far. More later.

     


    Disclosure: no positions
    Tags: S, VZ, T, GOOG, MSFT, mobile, technology
    Mar 24 3:26 PM | Link | Comment!
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