Tuesday, January 27, 2015
- Western Digital (NASDAQ:WDC) guided on its FQ2 CC for FQ3 revenue of $3.6B-$3.7B and EPS of $1.90-$2.00, mostly below a consensus of $3.73 and $1.99. With shares having already plunged over the last two days due to Seagate's outlook and Microsoft's numbers, investors are giving the hard drive giant a pass.
- FQ2 gross margin was 30.5%, up from 30.1% in FQ1 and the year-ago period, and above guidance for GM to be flat Q/Q. Western is also guiding for GM to be roughly flat Q/Q in FQ3.
- Notably, Western puts the total addressable market for hard drives in calendar Q4 at 140.8M units, less than the 144M-145M estimated by Seagate. That implies an FQ2 share of 43.4%, down from 44% in FQ1 and 44.4% a year ago. Average shipped drive capacity rose to 1.09TB from 1.00TB in FQ1 and 874GB a year ago. ASP was at $60.
- $309M was spent on buybacks, boosting EPS. R&D spend rose 2% to $426M, and SG&A spend 27% to $164M.
- FQ2 results, PR, prepared remarks, factsheet (.pdf)
- Micron (NASDAQ:MU), SanDisk (NASDAQ:SNDK), and InvenSense (NYSE:INVN) have joined Cirrus Logic, NXP, and several RF chipmakers in rising AH in response to Apple's FQ1 beat and stronger-than-expected iPhone sales print (74.5M units, +46% Y/Y).
- Micron became an iDevice mobile DRAM supplier through the Elpida acquisition. SanDisk has been both an iPhone NAND flash and MacBook SSD supplier, but there have been reports the company's recent woes are partly due to losing Apple as an SSD client. InvenSense's motion sensors were designed into the iPhone 6/6 Plus.
- MU +1.3% AH to $30.02. SNDK +1.3% to $79.99. INVN +1.7% to $15.19. InvenSense reports on Thursday. Micron was hit hard earlier today by Microsoft's FQ2 Windows figures and related commentary.
- Yahoo (NASDAQ:YHOO) has guided in its Q4 earnings slides (.pdf) for Q1 revenue (ex-TAC) of $1.02B-$1.06B, below a $1.1B consensus. Adjusted EBITDA is expected to fall to $200M-$240M from $306M a year earlier, and op. income to $50M-$90M from $149M.
- The company used its Alibaba IPO windfall to buy back $980M worth of shares in Q4 at an average price of $45.26 (contributed to the EPS beat). $9.7B have been bought back since Q2 2012.
- Q4 search revenue (ex-TAC) was nearly flat Y/Y at $462M, after rising 6% in Q3. However, search click revenue (excludes Microsoft payments) rose 18%, driven by a 10% increase in paid clicks and a 7% increase in price per click.
- Display revenue (ex-TAC), still hurt by share loss and the transition to native ads, fell 5% to $464M. Ads sold rose 17%, but price per ad fell 20%. All other revenue rose 2% to $253M.
- Americas revenue was flat Y/Y at $913M. EMEA fell 7% to $87M, and Asia-Pac 7% to $180M. Operating expenses rose 6% to $923M.
- On the CC, CFO Ken Goldman says Yahoo didn't include its Yahoo Japan (OTCPK:YAHOF) stake in the Alibaba spinoff in order to keep the transaction simple, but hints some other move could be on tap. "We are not saying we will not do something."
- Marissa Mayer says Yahoo is talking with Microsoft about the terms of the companies' search alliance; Mayer has made it clear more than once she's not happy with its performance. Not surprisingly, she also suggests Yahoo would love to displace Google (previous) as Apple's Safari search provider.
- YHOO +7.4% AH. Q4 results, Alibaba announcement.
- Electronic Arts (NASDAQ:EA) is guiding for FQ4 revenue of $830M and EPS of $0.22, below a consensus of $911.6M and $0.26. However, the huge beat posted for EA's seasonally biggest quarter is taking priority.
- EA's packaged goods/other revenue (traditional game sales) fell 31% Y/Y in FQ3 to $755M. But full game download revenue rose 22% to $140M, extra content revenue 47% to $314M, and subscriptions/ad/other revenue 52% to $100M. Mobile revenue grew 13% to $139M.
- Also boosting EPS: Sales/marketing revenue fell 21% to $169M. R&D spend rose 3% to $283M. $97M was spent on buybacks.
- Xbox One/PS4 revenue rose 51% to $593M. Xbox 360/PS3 revenue fell 42% to $412M. International markets accounted for 58% of sales.
- FQ3 results, PR
- Apple suppliers Cirrus Logic (NASDAQ:CRUS), NXP (NASDAQ:NXPI), Skyworks (NASDAQ:SWKS), Qorvo (NASDAQ:QRVO), and Avago (NASDAQ:AVGO) are up AH after the tech giant blew away FQ1 estimates on the back of 74.5M iPhone sales (+46% Y/Y and above forecasts of ~66-67M). iPad sales of 21.4M (-18%) were roughly in-line
- CRUS +2.9% to $26.79. NXPI +1.5% to $79.20. SWKS +1.3% to $82.60. QRVO +1% to $74.48. AVGO +2.7% to $107.60.
- Cirrus and Qorvo report tomorrow, and NXP on Feb. 4. Skyworks posted an FQ1 beat and offered strong guidance last week.
- Tim Cook has provided a more concrete timetable for Apple's (NASDAQ:AAPL) smartwatch launch on the FQ1 CC. 9to5 Mac previously reported hearing the Watch would launch by the end of March; Apple had before only said it would ship in "early 2015." (live blogs: WSJ, BI)
- CFO Luca Maestri notes forex headwinds had a 4% impact on revenue growth (plenty of other tech giants can relate), with the yen and ruble the biggest culprits. He suggests the impact going forward will be around 5%; more favorable component costs will partly offset.
- Maestri adds iPhone channel inventory fell by 200K Q/Q, and that supply only met up with demand in January. iPad inventory rose by 1M.
- Other details: 1) iPhone sales more than doubled Y/Y in mainland China and Brazil. 2) App Store revenue rose 41% Y/Y. iTunes/media revenue rose by $200M to $2.6B. 3) Apple now has 447 retail stores (182 outside the U.S.).
- AAPL +4.9% AH. FQ1 results, details.
- In addition to beating Q4 EPS estimates (while posting in-line revenue), Freescale (NYSE:FSL) is guiding for Q1 revenue of $1.135B-$1.185B, above a $1.11B consensus.
- Driving the EPS beat: Q4 gross margin was 47.2%, up 90 bps Q/Q and 330 bps Y/Y, and soundly beating guidance for a 75-100 bps Q/Q drop. GM is expected to be roughly flat Q/Q in Q1.
- RF chip sales (lifted by Chinese 4G base station demand) were a standout in Q4, rising 71% to $164M. Microcontroller sales +5% Y/Y to $232M. Digital networking -11% to $217M (carrier and industrial weakness). Automotive MCUs +1% to $271M. Analog/sensors +2% to $193M.
- Operating expenses rose 4% to $327M. $74M was spent on capex in Q4, and $249M over the whole of 2014.
- Shares have risen to $29.50 AH, making new 52-week highs along the way.
- Q4 results, PR
- AT&T (NYSE:T) added 1.9M net wireless subscribers (up from prior 809K), keyed by postpaid (854K net adds) and connected devices. Postpaid churn of 1.22% (up from the prior year's record low, but comparable to two years ago).
- More than half of customers have moved off the subsidized plans.
- Record 10.1M postpaid sales (includes upgrades and gross adds); Smartphones were 94% of postpaid sales and now account for 83% of the postpaid base.
- The company notes that closing the DTV deal will mean the largest revenue stream would come from business-related accounts ("growing nearly 6%"), followed by consumer TV and broadband, then by consumer mobility.
- After the DTV closing and following its Iusacell and Nextel Mexico deals, AT&T will have further "diversified networks, geographies, products and revenue streams."
- Previously: AT&T sees "continued" revenue growth and expanding margins (Jan. 27 2015)
- Thanks to a stronger-than-expected iPhone mix, Apple (NASDAQ:AAPL) had an FQ1 gross margin of 39.9%, up 200 bps Y/Y and above guidance of 37.5%-38.5%. FQ2 GM guidance is at 38.5%-39.5%.
- Product line performance: iPhone revenue (69% of total revenue) +57% Y/Y to $51.2B; units +46%. iPad -22% to $9B; units -18%. Mac +9% to $6.9B; units +14%. Services (iTunes, App Store, Apple Pay, etc.) +9% to $4.8B. Other products (iPod, Apple TV, Beats, accessories, etc.) -5% to $2.7B.
- Regional performance: Americas revenue +23% to $30.6B. Europe +20% to $17.2B. Greater China +70% to $16.1B (pent-up demand for bigger iPhones). Japan +8% to $5.4B. Rest of Asia-Pac +33% to $5.2B. International sales were 65% of revenue.
- With the 6 Plus providing a boost, iPhone ASP rose to $687 from $603 in FQ4 and $561 in FQ3. iPad ASP fell to $419 from $432 and $443. Mac ASP rose to $1,258 from $1,200 and $1,255.
- SG&A spend rose 18% Y/Y to $3.6B, and R&D spend 43% to $1.9B.
- $5B was spent on buybacks. Apple ended FQ1 with over $177B in cash/investments, and over $36B in debt.
- AAPL +5.3% AH to $114.90. FQ1 results, PR.
4:33 PM| 218 Comments
- AT&T (NYSE:T) expects a 2015 of "continued consolidated revenue growth" and adjusted EPS growth "in the low single-digit range" while improving free cash flow and dividend coverage.
- The company noted revenue gains of 4.5% after adjusting for Connecticut wireline property sale, highlighted by total wireless revenues that grew 7.7% to $19.9B. Wireline revenues gained 0.4% to $14.6B.
- Wireless service revenues were down again, -3.7% to $15.1B, on "continued customer growth of Mobile Share Value plans." Wireless operating income -18.1% to $3.2B; Phone-only postpaid ARPU dropped 10.7% Y/Y.
- For the full year, revenues of $132.4B were up 2.8% from 2013 (3.1% when excluding Connecticut wireline divestments) and EPS was up fractionally to $2.51 from $2.50. Full-year cash from operations was $31.3B; capex of $21.4B.
- Stock up 1.7% after hours.
- Conference call starts at 4:30.
- Q4 results
4:30 PM| Comment!
4:25 PM| Comment!
- In addition to beating Q4 estimates, Juniper (NYSE:JNPR) has guided for Q1 revenue of $1.02B-$1.06B and EPS of $0.28-$0.32. The former is favorable to a $1.02B consensus, and the latter in-line with a $0.30 consensus.
- Juniper also forecasts 2015 operating expenses will be in a range of $1.875B-$1.925B, down $115M Y/Y at the midpoint.
- The company promises to buy back $1B worth of shares by the end of Q2, provided the needed debt financing is obtained. $500M was spent on buybacks in Q4.
- Shares have risen to $22.75 in AH trading.
- Q4 results, PR
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