Seeking Alpha
  • Wednesday, April 23, 2014

  • 7:29 PM
    • Net neutrality supporters won't like this: The NYT and WSJ report the FCC will propose rules tomorrow that let ISPs charge content providers extra for priority access to their networks. The commission will continue prohibiting ISPs from limiting or blocking individual services.
    • FCC chairman Tom Wheeler has already hinted the commission could make such a move. Today's reports come after an appeals court threw out the FCC's existing neutrality rules in January; Netflix (NFLX) shares fell on the ruling.
    • Netflix, which accounts for a giant chunk of downstream U.S. broadband traffic, recently joined other Internet giants in paying direct peering fees to Comcast; that quickly led to a big improvement in Comcast's Netflix streaming speeds. But Reed Hastings has made it clear he's not thrilled with the deal, and wants tougher neutrality laws imposed.
  • 7:07 PM
    • Over 200M of Facebook's (FB) 1.28B MAUs use Facebook Messenger, Mark Zuckerberg shares on the Q1 CC. That figure, which comes as Facebook begins requiring mobile users download the standalone Messenger app to use it, suggests Messenger's user base is on par with Instagram's and ~40% of WhatsApp's. (CC live blogs I, II)
    • Outgoing CFO David Ebersman notes headcount rose 39% Y/Y in Q1, and expects GAAP costs/expenses will grow 35%-40% in 2014; GAAP growth was 32% in Q1, and non-GAAP growth 26%.
    • Ebersman also warns Y/Y ad sales growth (+82% Y/Y in Q1) will slow meaningfully going forward. Facebook's 2014 revenue growth consensus (also accounts for payments/other revenue) was at 44.6% going into earnings.
    • Sheryl Sandberg cautions Facebook's auto-play video ads (launched last month amid high expectations) won't be a major contributor this year. On the other hand, she notes use of Facebook's custom targeting ad tools has grown 10x Y/Y, boosting ROI (and with it, ad prices).
    • Though accounting for just 16% of Facebook's MAU base, North America produced 47% of Facebook's Q1 revenue, down just slightly from Q4's 48%. Facebook's North American ARPU ($5.85, up $2.35 Y/Y) remains well above its ARPUs for Europe ($2.44, up $0.84), Asia ($0.93, up $0.29), and elsewhere ($0.70, up $0.20).
    • FB +3.7% AH. Q1 results, details, slides.
  • 6:41 PM
    • Texas Instruments (TXN) expects Q2 revenue of $3.14B-$3.4B and EPS of $0.55-$0.63, largely above a consensus of $3.15B and $0.52. Shares +3.4% AH. (Q1 results, PR)
    • Xilinx (XLNX) expects FQ1 revenue to be flat to up 4% from an FQ4 level of $617.8M. That implies a midpoint of $630.2M, below a $638.4M consensus. Shares -5.1% AH. Rival Altera (ALTR) -4% ahead of tomorrow's FQ1 report. (FQ4 results, PR)
    • ServiceNow (NOW) expects Q2 revenue of $160M-$162M and full-year revenue of $652M-$657M, above consensus forecasts of $156.7M and $644.2M. Shares -1.6% AH. (Q1 results, PR)
    | Comment!
  • 6:19 PM
    • Apple (AAPL) aims to deliver annual dividend hikes going forward, new CFO Luca Maestri states on the CC. With the company's domestic cash balance now at $18B, Apple will once more tap debt markets to help pay for its dividend and freshly-expanded buyback program. (CC live blogs: I, II)
    • Tim Cook partly attributes FQ2's soft iPad sales to inventory changes; slowing tablet market growth might also be playing a role. iPad ASP was at $465, up from $440 in FQ1 and and $439 in FQ4 (suggests a mix shift towards the iPad Air).
    • Healthy emerging markets demand contributed to iPhone strength - BRIC sales hit a record, thanks in part to China Mobile. iPhone ASP came in at $596 vs. $637 in FQ1 and $577 in FQ4; Maestri suggests a mix shift towards the 4S contributed to the Q/Q drop.
    • Cook states Apple has bought 24 companies in the last 18 months - some are known to the public, but not all - and is "on the prowl" for deals. "We look for companies that have great people and great technology and that fit culturally and we don’t have a rule that says we can’t spend a lot or whatever."
    • Also: 1) Angela Ahrendts will begin working as Apple's retail chief next week. 2) 20M Apple TVs have now been cumulatively sold. 3) Roughly half of all iPhone buyers and 2/3 of iPad buyers were new buyers of the respective products. 4) There are now nearly 800M iTunes accounts. Will credit cards linked to them be leveraged for a payments service?
    • AAPL +7.7% AH. FQ2 results, split announcement, details.
  • 5:54 PM
    • Teradyne Inc. (TER): Q1 EPS of $0.11 beats by $0.05.
    • Revenue of $321M (+14.5% Y/Y) beats by $6.43M.
    • Press Release
    | Comment!
  • 5:54 PM
    • PTC (PTC): Q2 EPS of $0.48 beats by $0.02.
    • Revenue of $329M (+4.6% Y/Y) beats by $4.14M.
    • Press Release
    | Comment!
  • 5:47 PM
    • TriQuint (TQNT) expects Q2 revenue of $215M-$225M and EPS of $0.06-$0.08, above a consensus of $200.3M and $0.04. Shares +6.5% AH. Merger partner RF Micro (RFMD), which reports on April 29, is up 3.1%. Both companies might also be getting a lift from Apple's March quarter iPhone sales print. (Q1 results, PR)
    • Fortinet (FTNT) guides in its earnings slides (.pdf) for Q2 revenue of $169M-$172M (above a $168.9M consensus), EPS of $0.10 (below an $0.11 consensus), and billings of $185M-$190M (+17% Y/Y). Q1 billings totaled $188M, +26% Y/Y and well above guidance of $168M-$173M. Shares +4.4% AH. (Q1 results, PR)
    • Crown Castle (CCI) has raised its full-year AFFO forecast to $1.346B-$1.361B ($4.04-$4.08/share) from a prior $1.318B-$1.333B. Site rental revenue guidance has been raised by $11M to $2.983B-$2.993B. (Q1 results, PR)
    | Comment!
  • 5:27 PM
    • F5 (FFIV) expects FQ3 revenue of $428M-$438M and EPS of $1.33-$1.36, largely favorable to a consensus of $428.7M and $1.33. Shares +2.7% AH. (FQ2 results, PR)
    • Fusion-io (FIO) expects FQ4 revenue to be in-line or up slightly Q/Q relative to FQ3's $100.5M. That suggests revenue will miss a consensus of $107.5M. Gross margin is expected to be in a range of 52%-54% vs. 52.4% in FQ3., and op. margin in a range of -13% to -17% vs. FQ3's -16.7%. Shares -3.9% AH. (FQ3 results, PR)
    • Citrix (CTXS) expects Q2 revenue of $765M-$775M and EPS of $0.57-$0.59, below a consensus of $785.1M and $0.68. But full-year guidance is better: 8.5%-10% revenue growth and EPS of $2.90-$2.95 vs. a consensus for 9.1% growth and EPS of $2.91. Shares +4.7% AH. (Q1 results, PR)
    | Comment!
  • 5:20 PM
    • Morningstar (MORN): Q1 EPS of $0.58 misses by $0.09.
    • Revenue of $181.2M (+7.3% Y/Y) beats by $0.43M.
    • Press Release
    | Comment!
  • 5:12 PM
    • Apple sold 43.7M iPhones in its March quarter, well above expectations of ~38M and easily overshadowing soft iPad sales (16.35M vs. expectations of ~20M).
    • Apple-dependent Cirrus Logic (CRUS) is up 6.1% AH ahead of tomorrow's FQ4 report.
    | 1 Comment
  • 5:00 PM
    • Stronger-than-expected iPhone sales (carry higher margins than iPad/Mac sales) led Apple (AAPL) to post an FQ2 gross margin of 39.3% +180 bps Y/Y and above guidance of 37%-38%. GM guidance is set at 37%-38% for FQ3.
    • iPhone revenue (57% of total revenue) +17% Y/Y to $26.1B, an improvement from FQ1's 6% growth. iPad revenue -13% to $7.6B, a reversal from FQ1's +7%. Mac revenue +1% to $5.5B vs. +16% in FQ1.
    • iTunes/software/services revenue +11% to $4.57B (+19% in FQ1), accessories +3% to $1.4B, iPods -52% to $461M.
    • Exc. retail, Americas revenue +2% vs. -1% in FQ1. Europe +4% vs. +5%, Greater China +13% vs. +29%, Japan (has been a strong spot) +26% vs. +11%, rest of Asia-Pac (has been a weak spot) -17% vs. -9%. Retail sales were flat after growing 9% last quarter.
    • ~$18B was spent on buybacks, providing a lift to EPS. As a result, Apple's cash/investment balance fell by ~$9B to $150B.
    • FQ2 results, split announcement, PR
  • 4:57 PM
    • LSI Corporation (LSI): Q1 EPS of $0.17 beats by $0.02.
    • Revenue of $569M misses by $16.47M.
    • Press Release
    | Comment!
  • 4:47 PM
    • Along with its FQ2 results, Qualcomm (QCOM) discloses it has received a Wells Notice from the SEC's L.A. office over alleged Chinese bribery. The office recommends the SEC file an enforcement action against the company.
    • Qualcomm has made a Wells submission arguing it isn't violating federal international bribery laws, and doesn't believe action is needed. The company says it's continuing to cooperate with the SEC and DOJ.
    • Chinese regulators have been carrying out an antitrust probe of Qualcomm widely seen as an effort to obtain lower 4G royalty rates.
    • QCOM -4% AH.
  • 4:42 PM
    | 1 Comment
  • 4:38 PM
    • Along with its FQ2 results, Apple (AAPL) has announced a 7:1 stock split. Split-adjusted trading will start on June 9.
    • The company's buyback authorization has been raised by $30B to $90B, and its quarterly dividend hiked by 8% to $3.29 (2.5% yield).
    • Shares remain halted. They'll resume trading at 4:45PM ET.
  • 4:38 PM
    • Xilinx, Inc. (XLNX): Q1 EPS of $0.53 misses by $0.02.
    • Revenue of $617.82M (+16.1% Y/Y) beats by $6.08M.
    • Press Release
    | Comment!
  • 4:36 PM
    • Texas Instruments Inc. (TXN): Q1 EPS of $0.44
    • Revenue of $2.98B (+3.5% Y/Y) beats by $30M.
    • Press Release
    | Comment!
  • 4:33 PM
    • Apple (AAPL): FQ2 EPS of $11.62 beats by $1.44.
    • Revenue of $45.65B beats by $120M.
    • 43.7M iPhones (above expectations), 16.35M iPads (below expectations), 4.1M Macs.
    • Expects FQ3 revenue of $36B-$38B vs. a $37.8B consensus.
    • Shares halted.
    • CC at 5PM ET. Press Release.
  • 4:28 PM
    • Zynga's (ZNGA) Mark Pincus, whose management style has often come under criticism, is stepping down from an operational role at the company, but will remain chairman. Pincus stepped down as CEO last year to make way for Don Mattrick.
    • Zynga also announces it has has hired Microsoft Xbox Live GM Alex Garden to be the head of Zynga Studios, gaming/entertainment industry vet Henry LaBounta to be its chief visual officer, and e-commerce industry vet Jennifer Nuckles to be its marketing chief.
    • Q2 guidance is for bookings of $175M-$195M and EPS of -$0.08 to -$0.07 vs. a consensus of $185.9M and -$0.01. 2014 guidance is for bookings of $770M-$810M and EPS of $0.01-$0.03 vs. a consensus of $783.6M and $0.01.
    • Q1 results, PR
  • 4:19 PM
    • Lam Research Corporation (LRCX): FQ3 EPS of $1.26 beats by $0.10.
    • Revenue of $1.23B (+45.6% Y/Y) beats by $10M.
    • Press Release
    | 1 Comment
DJIA (DIA) S&P 500 (SPY)