Today - Tuesday, March 11, 2014
- Anne Sweeney, the head of Disney's (DIS) ABC unit and the co-chair of its cable network ops, tells the Hollywood Reporter in a joint interview with CEO Bob Iger she's leaving by year's end to become a TV director.
- Iger suggests Sweeney's replacement will be an internal hire, and that a decision will be made quickly. "My goal is to do it fast because Anne and I both feel that getting someone in the job while pilot season is in full swing [through May] so that they can at least have some direct experience..."
- Meanwhile, the NY Post reports Facebook (FB) COO/ad chief Sheryl Sandberg, already a Disney board member, has "had conversations about her interest" in becoming Disney's CEO following Iger's planned 2016 departure.
- Though CFO Jay Rasulo and parks chief Thomas Staggs have been viewed as the media giant's top CEO candidates, the board reportedly wants to "cast a wider net."
- The Daily Mail reported last week Sandberg was planning a 2016 California Senate run. But a source close to Sandberg denied the report to Business Insider soon afterwards.
- Castlight Health (CSLT) has hiked the price range for its 11.1M-share IPO to $13-$15 from a prior $9-$11. The company is now looking to raise $144M-$165M, and sport an IPO valuation of $981M-$1.13B.
- Castlight's software allows the employees of its 106 customers to access and manage their healthcare info. The company had 2013 revenue of just $13M (up over 3x Y/Y), a net loss of $62.2M, and a year-end deferred revenue balance of $11.5M. Sales/marketing spend totaled $33.7M, and R&D spend $15.2M..
5:07 PM| Comment!
- MagnaChip's (MX) audit committee has determined the company "incorrectly recognized revenue on certain transactions." Restatements are planned for 2011, 2012, and the first three quarters of 2013. (PR)
- In addition, MagnaChip is withdrawing its prior Q4 guidance due to the review. The company doesn't expect its restatements will affects its reported cash/debt balances for the covered periods.
- CFO Margaret Sakai will no longer serve as MagnaChip's principal accounting officer. Jonathan W. Kim, once the CFO of cloud software firm Zero Desktop, is now MagnaChip's chief accounting officer.
- MagnaChip originally delayed its Q4 report on Jan. 27 to give itself more time to review its numbers.
- Alibaba (ABABA) is spending $805M to buy a 60% stake in ChinaVision Media, a Hong Kong-based producer of films and TV dramas.
- The deal represents a big expansion of the Chinese e-commerce giant's attempts to carve a foothold in China's fast-growing and fragmented online/mobile video market. Though Youku (YOKU) remains the market's biggest player, strong competition is provided by Baidu, Sohu, and Tencent.
- Alibaba, Baidu, and Tencent have been constantly finding ways to encroach on each others' turf. Yesterday, Tencent announced it's buying a 15% stake in #2 Chinese e-commerce firm JD.com.
- VeriFone (PAY) expects FQ2 revenue of $440M-$445M and EPS of $0.30-$0.32 vs. a consensus of $439.1M and $0.31. FY14 (ends in Oct.) guidance is for revenue of $1.78B-$1.81B and EPS of $1.40 vs. a consensus of $1.79B and $1.39.
- After declining 12% Y/Y in FQ4, revenue grew 2% in FQ1 thanks to a 19% increase in services revenue (boosted some by acquisitions) to $174.9M. System (hardware) revenue fell 7% to $261.2M, but that's better than FQ4's 23% drop.
- Gross margin fell 200 bps Y/Y to 42%. Opex jumped 18% Y/Y to $152M (exc. amortization costs), with R&D and G&A spend each rising 27%. Sales/marketing spend rose 10.5%.
- North American sales -2% Y/Y, Latin America -3.4%, EMEA +3.4%, Asia-Pac +6.3%.
- Shares have crossed their 52-week high of $30.72 in AH trading.
- FQ1 results, PR
4:02 PM| Comment!
- BrightWire and Marbridge Consulting report China Mobile (CHL -0.6%) has told its phone suppliers all 4G phones provided from May onwards must support five air interfaces - 4G TD-LTE and FDD-LTE, 3G TD-SCDMA and W-CDMA, and 2G GSM. Currently, OEMs can get away with supplying phones supporting only the three interfaces used by China Mobile - TD-LTE, TD-SCDMA, and GSM.
- The move could benefit baseband chip giant Qualcomm (QCOM -0.4%), given the company's expertise in supporting a huge variety of air interfaces and frequency bands. That is, provided the Chinese government's antitrust probe doesn't get in the way.
- Strategy Analytics estimates Qualcomm, buoyed by a dominant 4G baseband position (97% share as of Q1 2013), had a 64% 2013 baseband revenue share. But competition is intensifying: Intel, Broadcom, MediaTek, and Nvidia are all in the midst of launching 4G baseband parts.
- Last November, Qualcomm announced the Gobi 9x35, a next-gen 4G baseband that offers theoretical max speeds of 300Mbps (2x its predecessor) and supports six air interfaces.
- Paycom Software, a developer of cloud-based talent management, payroll, and HR management software, has filed for a $100M IPO under the symbol PAYC. Barclays, JPMorgan, Pac Crest, Stifel, and Canaccord are underwriting.
- Paycom argues its apps are differentiated in part by their ability to leverage an integrated platform that eliminates redundant data entry and the need to access multiple databases.
- The company claims to have 10K+ clients, with none accounting for more than 0.5% of revenue. Rivals include cloud HR software leader Workday, smaller vendors Cornerstone OnDemand and Ultimate Software, and enterprise software giants SAP and Oracle (both have made acquisitions in this space).
- Paycom had 2013 revenue of $107.6M (+40% Y/Y), and net income of $5.4M. Sales/marketing spend equaled 40% of revenue, and the company's deferred revenue balance totaled $12.6M at the end of 2013.
- Given how peers have performed lately, investor interest could be strong.
- Though ChipMos (IMOS -2%) missed Q4 EPS estimates by $0.09 (the company blames higher tax expenses and non-controlling interests), it's guiding for Q1 revenue to be "flat to up in the low single digits" from a Q4 level of $163.9M. That's favorable to a $161.4M consensus.
- Q4 revenue (-5% Q/Q) was in-line with guidance for a 4%-8% drop. Likewise, gross margin (18.9%, up from 13.7% a year ago and down from 22.2% in Q3) came within a guidance range of 16%-20%.
- Q1 GM is expected to be in a range of 17%-21%, and opex is expected to total 6%-8% of revenue. ChipMos' full-year capex is expected to be less than $80M. Tax rates are expected to remain high in Q1 before normalizing in Q2.
- The company says it remains "very positive" about its LCD driver/assembly ops, and expect process improvements to lower its materials costs.
- Q4 results, PR
- Twitter (TWTR +1.9%) has hired Baljeet Singh, a former senior YouTube exec responsible for developing the site's skippable pre-roll video ads (later imitated by many others).
- Singh is tasked with improving Twitter's video discovery features and content base, and of ramping its video ad sales. His hiring comes after Twitter began showing embedded photos/videos in user Timelines, and launched several ad products aimed at TV networks and advertisers.
- Separately, Twitter is continuing its ad expansion efforts by testing a click-to-call button (long a staple of Google and Yelp's mobile ads) that would allow users to directly call advertisers.
- Digiday observes the test is part of a broader push by Twitter to offer direct response ads that can do things such as "generate leads, drive app downloads, collect consumers’ email addresses and induce incoming calls."
- Previous: Twitter's 10-K shows ad impression growth, falling prices
- An rally that has already yielded huge gains for fuel cell and other alternative energy stocks is now propelling smart grid/wind turbine maker American Superconductor (AMSC +12.8%) higher.
- Last month, AMSC rallied on an FQ3 beat and a favorable legal ruling in its long-running battle against ex-customer Sinovel. 9% of the float was shorted as of Feb. 14.
- As part of a chip sector coverage launch, Ascendiant Capital's Cody Acree (previously with Williams Financial) has started AMD (AMD +3.5%) with an Outperform and $5 PT.
- Acree: "While we are not expecting any singular dramatic near-term catalyst, we do see the company working through a methodic restructuring and repositioning that has already reduced spending and earned significant [design] wins."
- Acree notes AMD's restructuring has lowered headcount by 15% and opex by 26%, while helping the chipmaker once more be cash flow positive. He also expects new APU launches to allow AMD to "regain moderate share" in the consumer PC space.
- Previous: AMD jumps following CEO's CNBC talk
- Re/code reports Jive Software (JIVE +8.1%) "has explored a sale during the last several months," and has hired boutique tech i-bank Qatalyst Partners (led by Frank Quattrone) to help find a buyer.
- No word on Jive's asking price. Oracle, SAP (previous), and Workday are all said to have passed on the enterprise social networking software vendor, which has seen its sales pressured by competition from the likes of Salesforce, IBM, and Microsoft's Yammer unit.
- Nearly 1/6 of the float was shorted as of Feb. 14.
- Pac Crest's Brent Bracelin (Outperform, $14 PT) reports Fusion-io's (FIO +5.6%) channel partners are seeing improved demand for the company's new storage appliances and software.
- He also thinks Fusion-io could benefit from the launch of a 3rd-gen server flash module platform, and from diminishing competition. The PCIe flash module space has seen some consolidation, and Violin Memory recently suggested it's abandoning the market. But competition is still provided by Western Digital, Intel, LSI, and others.
- Fusion-io's sales were hit hard last year by declining orders from Apple and Facebook. The company is counting on a stronger enterprise push (led by new CEO/ex-H-P exec Shane Robison) and growing sales to other Web/cloud clients (e.g. Salesforce, Pandora, Yelp, Alibaba) to spark a turnaround.
- Ahead of a big speech at the U.S. Chamber of Commerce, SoftBank's (SFTBF, SFTBY) Masayoshi Son is promising a "massive price war" if skeptical regulators allow Sprint (S +0.7%) to merge with T-Mobile USA (TMUS +2.4%).
- As expected, Son also insists Sprint and T-Mobile, who between them have a giant portfolio of high-frequency spectrum assets, could act as a credible last-mile broadband rival to phone/cable duopolies if they joined forces.
- AT&T (T -0.8%) and Verizon (VZ -0.6%) are ticking lower, while Sprint and T-Mobile are up moderately. AT&T has already been cutting prices to counter T-Mobile's aggressive moves - moves that have contributed to FCC/DOJ doubts about the merits of a Sprint/T-Mobile deal.
- Verizon, for now, is refusing to take part in a price war, and betting its service quality and unmatched 4G coverage will lead its pospaid subs to continue paying a premium.
- Yesterday: U.S. mobile roundup