Today - Tuesday, April 28, 2015
- Netlist (NASDAQ:NLST) has signed a letter of intent with LG to work on a mobile memory controller based on Netlist's HyperVault tech (pairs flash and DRAM), with the intention of using the controller (referred to as HVMMC) is a "next generation mobile system."
- Netlist/LG assert the solution will lower the density of DRAM (more expensive than NAND flash) without affecting performance. Netlist has also been targeting HyperVault at enterprise applications that could benefit from lower flash latency (by having flash directly on the memory bus), such as transaction processing, analytics, and in-memory databases.
- Shares have soared on the announcement. It arrives a month after Netlist tumbled due to the loss of a breach of contract and trade secret suit against flash controller IC vendor Diablo Technologies.
- Corning (GLW -1.2%) had a Q1 gross margin of 41%, up 20 bps Y/Y and better than expected in light of strong forex pressures. That, along with $500M in buybacks, help EPS beat estimates in spite of a revenue miss. A weak yen respectively had $165M and $137M impacts on Q1 sales and gross profits.
- The Optical Communications (fiber) division was a Q1 standout: Sales rose 18% Y/Y to $697M (guidance was for 10%+ growth). Strong North American fiber-to-the-home spending contributed, as did the purchase of fiber/copper interconnect maker TR Manufacturing. Mid-teen growth is expected for the division in Q2; the Samsung fiber division purchase will provide a lift.
- Display Technologies (LCD glass) revenue fell 13% Y/Y to $808M thanks to the yen's weakness; if not for forex, revenue would've risen 1% to $972M. LCD glass volumes rose by a high-teen % Y/Y, price declines (as expected) were moderate, and margins improved. Volumes are expected to fall be a low-single digit % Q/Q in Q2, with price declines even smaller than Q1's.
- Specialty Materials sales rose 4% Y/Y to $272M, thanks to a 20% increase in Gorilla Glass volume - the Galaxy S6 and its dual Gorilla Glass 4 panels helped. Sales are expected to drop by a mid-single digit % Y/Y in Q1, with advanced optics weakness offsetting Gorilla Glass growth. GG4 demand is expected to continue rising in 2H15.
- Environmental Technologies (emissions control) sales rose 3% to $282M. They're expected to fall by a mid-single digit % in Q2 due to a weak euro. Life Sciences sales fell 6% to $197M, and are expected to be down slightly in Q2.
- T-Mobile (NYSE:TMUS) opened 0.2% to the upside after posting revenue that grew 13% and beat expectations and logged its eighth straight quarter of 1M net subscriber additions.
- Adjusted EBITDA of $1.388B (up 27.6%) missed expectations of $1.397B.
- In subscriber numbers, the company posted 1.8M total net subscriber adds (1.1M branded postpaid net adds, 1M branded postpaid phone net adds). The company's expecting to capture all industry subscriber growth for Q1. Branded postpaid churn is down 17 bps to 1.3% (down 43 bps from Q4).
- Branded postpaid ARPU was down 3.8% sequentially to $46.43. Excluding a net revenue deferral tied to Data Stash, it declined 1.2% sequentially and 5.5% from the prior year.
- The company's raising its subscriber guidance for 2015, to 3.5M branded postpaid net adds (up from 3M). It's keeping its target for adjusted EBITDA of $6.8B-$7.2B, in line with expectations.
- Earnings call livestream at 10 a.m. ET.
- Q1 press release
- Sirius XM Holdings (NASDAQ:SIRI) is off 1.3% premarket after a Q1 miss on top and bottom lines that still saw double-digit growth in net income and strong subscriber additions.
- Adjusted EBITDA of $399M was up 19% to an all-time high and beat an expected $392M. EBITDA margin of 37% was also a company high.
- Net subscriber additions during Q1 were 431K, up 61% from the prior-year 267K. Self-pay net adds were 394K, up from prior year's 173K. Self-pay monthly churn was down slightly to 1.8% from 1.9%. Ending total subscribers was 27.4M.
- Revenue breakout: Subscriber, $911.5M (up 7%); Advertising, $26.9M (up 21%); Equipment, 24.8M (up 3.6%); Other, $117.8M (up 17.7%).
- Free cash flow of $276M, up 24%.
- The company raised its guidance on 2015 revenue to $4.47B (vs. expectations of $4.48B) and raised its expected net subscriber adds to 1.4M, while reiterating guidance for adjusted EBITDA of $1.6B (vs. expectations of $1.639B) and free cash flow of about $1.25B.
- Press release
- Believing new promotional tools for sellers will give a lift to its top line, Credit Suisse has upgraded MercadoLibre (NASDAQ:MELI) to Outperform, and hiked its target by $55 to $191.
- The tools consists of ads that can appear on MELI's home page or within search results, and which lead to a seller's product listing page - Alibaba has plenty of experience with such ad formats. CS expects Latin American sellers will adopt the ads in much the same way Chinese and South Korean sellers have, and in doing so life MELI's take rate.
- CS has cut its near-term estimates due to the Venezuelan bolivar's ongoing weakness against the dollar, but lifted its longer-term estimates. The upgrade comes two weeks after MELI struck a deal to buy Brazilian online retail software provider KPL Soluções for at least R$50M ($16M), in an effort to better cater to merchant needs.
- Shares have risen to $140.90 premarket. The 52-week high is $144.23.
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