Today - Thursday, December 12, 2013
4:35 PMAdobe +3.9% AH; FY14 guidance light, but long-term forecast strong
- With its near-term results continuing to be pressured by the shift to Creative Cloud subscriptions from up-front Creative Suite licenses, Adobe (ADBE) is guiding for FQ1 revenue of $950M-$1B and EPS of $0.22-$0.28, below a consensus of $1.02B and $0.34. Likewise, Adobe forecasts flat FY14 (ends Nov. '14) revenue growth and EPS of $1.10, below a consensus for 7.8% growth and EPS of $1.60.
- On the other hand, with much of the revenue getting pushed out by the Creative Cloud shift set to be recognized in future years, Adobe expects to see a 20% revenue CAGR from FY14-FY16. The company is also targeting FY15 EPS of $2 and FY16 EPS of at least $3.
- 402K paid Creative Cloud subs were added in FQ4, up from 331K in FQ3, 221K in FQ2, and 153K in FQ1. The total base is now at 1.439M. Creative annual recurring revenue (ARR) rose 41% Q/Q to $768M, and total digital media ARR rose 39% to $911M.
- Thanks to both strong organic growth and the Neolane acquisition, Marketing Cloud (online/mobile ad tech) revenue rose 38% Y/Y to $316.2M (30% of total revenue). That represents an acceleration from FQ3's 28% growth.
- Deferred revenue rose by $94.7M Q/Q to $828.8M, and EPS was boosted by $405M in buybacks.
- CC at 5PM ET. FQ4 results, PR, datasheet, slides
4:34 PMRestoration Hardware -10.4% AH on beat and raise Q3, co-CEO departure
- Shares of Restoration Hardware (RH) are taking a 10.4% drubbing AH after the company's Q3 report beat expectations and a raised Q4 outlook meets analyst expectations. However, co-CEO Carlos Alberini will step down at the end of Jan. to become CEO of Lucky Brand. The company will initiate a search for a replacement.
- Management raises Q4 guidance to revenue of $490M-$500M (vs. analyst consensus of $497.2M) and EPS of $0.82-$0.85 (vs. $0.85).
- Revenue grew 39% Y/Y to $395.8M, accelerating from a 22% increase in Q3 2012. Direct revenue grew 47% on top of a 24% increase in the same period last year.
- Comparable store sales rose 29% Y/Y, an identical clip to Q3 2012.
- Operating income skyrocketed 299% to $23.9M as the company leveraged SG&A, which decreased 570 bp Y/Y to 29.5% of revenue.
- Conference call at 5pm ET, PR
11:51 AMCisco lowers growth outlook, peers/suppliers fall in sympathy
- Cisco (CSCO -2.3%) is now targeting annual revenue growth of 3%-6% over the next 3-5 years, down from a prior 5%-7%, says CFO Frank Calderoni states at the networking giant's analyst meeting. In addition, Calderoni says Cisco's FY14 (ends July '14) revenue growth outlook is "basically" in-line with a Street forecast for a 4% decline.
- Cisco is now aiming for services revenue growth of 7%-10% over the next 3-5 years, down from 9%-11%; services accounted for 22% of Cisco's Oct. quarter revenue. Businesses related to "enabling the cloud" (a somewhat nebulous term) are expected to show a 12%-18% growth rate.
- Cisco, already pressured by John Chambers' macro comments, continues to trade lower. Many networking equipment peers and component/chip suppliers are also selling off; in addition to Cisco, Ciena's mixed FQ4 results and slightly soft FQ1 guidance could be playing a role here.
- Notable networking equipment/component/chip decliners: JNPR -3.1%. BRCM -2.5%. PKT -2.8%. FFIV -2.2%. ERIC -2.1%. JDSU -1.9% (getting pulled from the S&P 500). AFOP -5.5%. CAVM -1.7%. AMCC -1.8%. BRCD -1.8%. MRVL -1.6%. ARUN -1.7%. CALX -1.7%.
10:06 AMSigma Designs plummets on Q3 miss, bleak guidance
- Sigma Designs (SIGM -17.9%) shares are selling off after the company missed expectations in Q3 and provided bleak guidance.
- CEO Thinh Tran observed on the conference call that "shipment for the majority of the new products won't begin to materialize until the first half of next year. Meanwhile, our existing product line will experience challenges in the short term." He sees demand declining for set-top boxes, DTV, and home control in Q4.
- Management guides for Q4 revenue of $40M-$44M (well below analyst expectations of $53.5M), gross margin of 59%-61%, and opex of $24.5M. Analysts currently expect EPS of $0.06.
- Following results, Needham cut its rating to Hold from Buy.
9:26 AMHovnanian up 4% after FQ4 results
- FQ4 gross margin of 22.6% is up from 18.3% a year ago and 20.3% in FQ3.
- Deliveries of 1,816 homes up 3.8% Y/Y. Dollar value of net contracts of $490.5M, off about 4%. Number of net contracts of 1,315, off 8.9%.
- Backlog of 2,392 homes and $848.4M is up 11.5% and 14.3%, respectively, from a year ago. Contract cancellation rate of 23% is flat from last year.
- Noting slowing sales from July-September, CEO Ara Hovnanian says sales improved back to prior-year levels in October (the last month of the Q) and exceeded last year's levels in November.
- CC at 11 ET.
- FQ4 results, press release
- HOV +4.6% premarket