Wednesday, May 6, 2015
- AMD has guided (.pdf) at its 2015 analyst day for 2H15 revenue to rise 15% (+/- 3%) from an expected 1H15 level of ~$2B. That implies full-year revenue of ~$4.3B, close to a $4.28B consensus.
- Gross margin is expected to be in a ~32%-34% range in 2H15 after amounting to ~32% in 1H15, and operating expenses are expected to fall to ~$680M-$700M from ~$715M. Free cash flow is expected to be negative in 1H15, and positive in 2H15.
- Long-term targets: 36%-40% GM, over $0.50/year in EPS, double-digit revenue growth from AMD's server CPU, embedded processor, and pro GPU ops, mid-single digit growth from its semi-custom (inc. console APU) and other GPU ops, and flat to down PC CPU revenue. AMD plans to use any cash in excess of $1B to retire debt (it had $906M at the end of Q1).
- AMD has also officially unveiled its 7000 Series notebook CPUs (codenamed Carrizo). The cheapest version has two 1.5GHz. cores, and a 10W max power draw.; the most powerful version had four 2.5GHz. cores, a 12-25W max power draw, and a Radeon R5 GPU. Also announced: A set of new mainstream desktop and notebook GPUs (the Radeon M300 line), and price cuts for A-series desktop CPUs (prices now range from $42-$127).
- In Q2, AMD plans to launch its first GPU to support High Bandwidth Memory (HBM); performance/watt is said to be over 3x greater than current-gen GDDR5 memory. In 2016, it plans to launch GPUs that support HBM and use a FinFET (3D transistor) process; TSMC's 16nm process is a possibility. AMD is counting on the GPUs to reverse share losses to Nvidia (NASDAQ:NVDA).
- Also launching in 2016: Zen, a next-gen CPU core said to handle 40% more instructions per clock cycle and feature a high-bandwidth/low-latency cache system. Samsung/GlobalFoundries' 14nm process is expected to be used; that would narrow Intel's (NASDAQ:INTC) manufacturing process edge, given Intel is currently at 14nm (10nm next year) and AMD at 28nm. Earlier today, SA author Alex Cho took a look at AMD's leaked 2016 Zen CPU roadmap.
- On the ARM (NASDAQ:ARMH) front, AMD is abandoning Project Skybridge, which sought to create "ambidextrous" platforms supporting either x86 or ARM CPUs. The timetable for the company's custom K12 ARM core has been pushed out from 2016 to 2017.
- Sprint (NYSE:S) fell 3% today following a quarter where it reported turnaround still in progress, and just as its No. 1 challenge became clear over the past several month -- upgrade its network to keep up with giants AT&T and Verizon, and hold off T-Mobile -- its cash burn is back in focus, as asset investments aren't cheap.
- Citigroup's Michael Rollins says that Sprint will burn free cash flow of around $6.1B in 2015. And analyst Craig Moffett notes the company last quarter burned through $914M of its $3.5B cash-and-marketable-securities total; "At this rate, Sprint will run out of money around the 2016 (radio spectrum) incentive auction."
- For those looking for a white knight, majority owner SoftBank (OTCPK:SFTBY) has more than $90B of its own debt to worry about. And Barclays pointed out that while cash burn is improving, visibility for Sprint's turnaround "remains elusive."
- In Sprint's earnings call, CFO Joseph Euteneuer was placid: "We're very comfortable with the liquidity here in the short-term, and as I said it will ultimately ... we'll look at two things. One, the continued growth of the business, and two, the final outcome of what we're going to do on a capital standpoint."
- In addition to beating Q1 revenue estimates (while missing on EPS), Cornerstone OnDemand (NASDAQ:CSOD) has guided on its CC (webcast) for 2015 revenue of $337.5M-$341.5M, up from prior guidance of $336M-$341M and mostly above a $337.9M consensus. EPS guidance of -$0.30 is slightly below a -$0.29 consensus.
- The cloud talent management software vendor's Q1 bookings totaled $63.5M, +28% Y/Y but trailing revenue of $74.4M (seasonality played a role). The deferred revenue balance rose 38% to $180.9M.
- GAAP operating expenses rose 27% Y/Y to $67M, a much slower pace than Q4's 42%. The customer base rose by ~100 Q/Q to over 2,200, and end-users by ~1M to over 19.1M.
- Shares have risen to $31.25 AH. Cornerstone says it plans to show off analytics tools and a cloud app platform (PaaS) solution (presumably for apps that integrate with Cornerstone's) at its May 11-13 Convergence conference.
- Q1 results, PR
- CenturyLink (NYSE:CTL) is working to bring more to the gigabit-broadband party with a plan to launch 1-Gbps Internet for another 100,000 Utah customers.
- The company began providing gigabit service last year to Salt Lake City businesses in multi-tenant buildings before growing that offering to other Utah locations; its new plan covers homes in a swath from north to south in the state.
- Google Fiber began providing its 1-Gbps fiber to Provo, Utah, after it acquired the existing "iProvo" network and upgraded it. Comcast, meanwhile, has begun high-profile launches of its 2-Gbps "Gigabit Pro" service for Atlanta, the San Francisco Bay, Chattanooga and Florida.
- Shares dropped 2.8% today following CenturyLink's Q1 earnings report.
- Previously: CenturyLink beats expectations on lower cash expense (May. 05 2015)
- Quantum's (NYSE:QTM) FQ4 revenue ($147.8M) was favorable to the outlook given in a positive April 9 pre-announcement (forecast revenue "in excess of" $145M). EPS of $0.06 matched the pre-announcement figure.
- With many big deals having closed toward the end of FQ4, FQ1 guidance is for revenue of $125M-$130M and EPS of $0.00-$0.01, below a consensus of $130.3M and $0.02. But Quantum is also forecasting 4%-5% FY16 (ends March '16) revenue growth, above a 2.1% consensus. Op. income is expected to rise 8%-10%, and scale-out storage revenue 50%.
- Scale-out revenue rose 116% Y/Y in FQ4 to $31.7M, and deduplication hardware-related revenue 30% to $25.2M, offsetting declines for non-branded and tape products. Gross margin rose 50 bps Y/Y to 42.4%, and is expected to be in a 45%-46% range in FQ1. Excluding restructuring charges, GAAP operating expenses rose by just $1.2M Y/Y to $59.7M.
- Shares have jumped to $2.30 AH, making new 52-week highs once more.
- FQ4 results, PR
- Though TripAdvisor (NASDAQ:TRIP) missed Q1 estimates amid heavy forex pressures, the company used its CC (webcast) to reiterate guidance for high-20s 2015 revenue growth; consensus is at 27.3%.
- Q1 revenue growth was 29% Y/Y in actual dollars, and 36% in constant currency. Click-based (search ad-driven) revenue +20% to $249M (69% of total revenue); display ads (expected to be soft) +9% to $35M; subscription, transaction, and other +88% to $79M.
- Regional performance: North American revenue +25% Y/Y to $182M; EMEA +33% to $120M; Asia-Pac +20% to $42M; Latin America +90% to $19M. International was 53% of total revenue.
- Other numbers: GAAP costs/expenses rose 48% Y/Y to $273M, thanks in large part to a 55% increase in sales/marketing spend to $157M. Headcount rose by 100 Q/Q and 800 Y/Y to 2.9K. Monthly unique visitors +31% Y/Y to 340M. Cumulative mobile app downloads are up to 190M.
- Shares have risen to $80.59 AH. Expectations were fairly low going in.
- Q1 results, PR
- Demand Media (NYSE:DMD) posted a revenue miss after sales shrank 26%, driven by a spate of issues at the company's websites, and the company posted a net loss of $6.7M.
- Adjusted EBITDA was $0.5M, vs. $4M expected.
- Revenue by segment: Content & Media, $22.5M (down 41%); Marketplaces, $10.7M (up 57%).
- Content & Media slid as traffic dropped to key properties (sites like eHow, Livestrong.com, Cracked.com), lower ad monetization yields and content reductions as well as selling the CoverItLive and Pluck businesses.
- The company's properties reached 57M unique visitors, including 31M mobile. Visits for the quarter came to 943.4M (down 5%); revenue per visit fell 38% to $23.87. For Marketplaces, transactions were up 31% to 182.2K and average revenue per transaction was up 21% to $58.65.
- Cash and equivalents were at $47.3M, against no outstanding debt.
- Press Release
6:07 PM| Comment!
- Level 3 Communications (NYSE:LVLT) said it's refinanced a seven-year $2B senior secured term loan, at Libor plus 2.75% (minimum Libor of 0.75%).
- The loan is replaces a similar former tranche that was priced at Libor plus 3.5% (minimum Libor 1%).
- The company will take a charge in Q2 of about $176M for debt extinguishment. The transaction should close on Friday.
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5:46 PM| Comment!
- MercadoLibre (NASDAQ:MELI) beat Q1 estimates on the back of a 26.4% Y/Y increase in items sold to 27.5M, a 56.2% increase in payments volume to $1.04B, and a 61.6% increase in payments transactions to 14.8M.
- Forex remains a major headwind: Revenue rose 28% Y/Y in dollars, and 100% in local currencies; excluding Venezuela, the numbers are 39.7% and 64.5%. GMV rose 77.5% Y/Y in local currencies, but fell 8.2% in dollars to $1.65B. A $20.4M forex loss was recorded on account of the Venezuelan bolivar's decline, as was a $16.2M asset impairment charge.
- Financials: Gross margin fell 290 bps Y/Y to 69.8% due to sales taxes and a mix shift towards payments (MercadoPago). Excluding the impairment charge, operating expenses rose 24% to $61.6M. Free cash flow was $29.9M.
- Other stats: MercadoPago's marketplace penetration rate was 50%, up over 2000 bps Y/Y (Brazil topped 90%). 5.7M registered users were added, bringing the base to 126.7M. The MercadoEnvios shipping service handled over 40% of Brazilian sold items. Over 750 branded stores are now on the marketplace, up from 85 a year ago.
- Shares have risen to $156.00 AH, making new 52-week highs along the way.
- Q1 results, PR
- In addition to missing Q1 estimates, Varonis (NASDAQ:VRNS) is guiding for Q2 revenue of $28.5M-$29.3M and EPS of -$0.28 to -$0.31 (below a consensus of $31.8M and -$0.16), and full-year revenue of $123.6M-$126.7M (+22-25%) and EPS of -$0.68 to -$0.73 (below a consensus of $131.3M and -$0.54).
- Q1 revenue of $23M was slightly below a $23.2M consensus. CEO Yaki Faitelson states EMEA sales were soft, and that Varonis thinks "this weakness could continue over the next few quarters." EMEA revenue +15% Y/Y to $8M; U.S. +44% to $13.1M; rest of world +31% to $1.9M.
- License revenue (drives future maintenance/services revenue) rose 26% Y/Y to $10.2M; maintenance/services revenue rose 36% to $12.8M. GAAP operating expenses rose 36% to $31.7M. Varonis says it's "making some adjustments to our spending, primarily in sales and marketing, to better align the business overall."
- Shares have fallen to $24.11 AH.
- Q1 results, PR
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