Jul. 17, 2014, 4:12 PM
Jul. 11, 2014, 11:07 AM
- ChannelAdvisor (ECOM +6.9%) clients saw a 34.4% Y/Y June increase in their Amazon (AMZN +4.5%) same-store sales. That growth rate is well above May's 28.1%, and is the highest rate seen in the last 12 months.
- Client eBay (EBAY +2.5%) same-store sales grew 12.3%. That's a little better than May's 11.5%, and suggests the toll taken by a data breach and Google algorithm changes might be abating a bit. Auctions -19%, fixed-price +18.4%, Motors +10.4%.
- A positive for Google (GOOG +0.9%): Search ad-driven same-store sales rose 20.4%, a big improvement from May's 11.5% and the 2nd-highest level seen in the last 12 months. Cost per click (ad prices) rose 5% to $0.48, conversion rates 6% to 2.81%, and average order value (AOV) 7% to $137.02.
- ChannelAdvisor notes AOV has historically "been a good indicator of consumer sentiment," and that the appeal of Google AdWords for marketing costlier items remains strong.
- Meanwhile, Google's product listing ads (PLAs) keep gaining traction as a vehicle for selling cheaper goods. Their same-store sales rose 47.8%, sharply above May's 21.4%. AOV fell 8.7%, but conversion rates rose 10.5%.
- Deutsche has upgraded ChannelAdvisor to Buy. eBay reports on July 16, Google on the 17th, and Amazon on the 24th.
May 9, 2014, 3:02 PM
- Though Himax (HIMX -12.2%) saw only modest losses yesterday after offering soft Q2 guidance (blamed on a customer inventory correction) to go with a slight Q1 EPS miss, it's having a much rougher time today.
- On the Q1 CC (transcript), management was peppered with questions about whether the inventory issues at a major Korean customer (almost certainly Samsung) stemmed from the customer losing share to rivals. Himax also faced questions about a relatively muted gross margin growth outlook, and the pace at which LCOS microdisplay sales (linked to Google Glass' launch) will grow.
- Chardan's Jay Srivasta downgraded shares to Sell yesterday: He thinks Samsung is "struggling to compete" against Chinese white-box OEMs (previous), and now believes Google Glass' (GOOG) commercial launch could be a 2015 event. As evidence, he notes Himax doesn't plan to ramp its LCOS production capacity this year - it's currently at just 300K units/month.
- Shares now go for less than 10x 2015E EPS.
Apr. 23, 2014, 8:41 AM
- Google (GOOG) and SunPower (SPWR) team to provide financing for about $250M of residential solar lease projects, with Google committing up to $100M and SunPower about $150M.
- The program is expected to allow thousands more to finance solar power systems through SunPower, joining about 20K who already do so.
- Press release
- SPWR +8.6% premarket
Apr. 17, 2014, 8:27 AM
- "Better than headlines suggest," says Baird's Colin Sebastian of Google's (GOOG) earnings results last night. Reiterating his Outperform rating and $675 price target, Kallo says the results are largely inline with expectations, and the company remains on track to leverage multiple long-term growth opportunities.
- "Our view on Google remains positive given the solid growth in the Websites business and multiple drivers that we expect to keep revenue growth near 20%," says Needham's Kerry Rice. Drivers include: "1) the push to bring brand advertising dollars to search and display, which we expect to become an important revenue driver over the next 18-24 months, and we note that an earlier ramp could drive upside. 2) The Android ecosystem puts Google as a preeminent mobile player. 3) We expect a modest but gradual improvement in CPCs. 4) Network revenue growth, while sluggish, should have a stronger H2."
- Calling Q1 a "small bump," Piper's Gene Munster says Google remains on track for steady growth in its core business as it invests in other products. "We continue to view Google as the best long term large cap story in our coverage space."
- Shares -1.5% premarket
- Previous earnings coverage
Apr. 16, 2014, 4:15 PM
- After falling 2% Q/Q in Q4 and 8% in Q3 thanks to mobile softness, Google's (GOOG) cost per click (ad prices) was flat Q/Q in Q1. On a Y/Y basis, it fell 9%.
- Paid clicks (boosted by mobile and product listing ads) grew 26% Y/Y, a slower clip than Q4's 31% but even with Q3. Traffic acquisition costs fell to 23% of revenue from 24% in Q4 and 25% a year ago.
- Google sites revenue (68% of total) +21% Y/Y vs. +22% in Q4. Ad network revenue (22% of total, pressured by policy changes) +4% vs. +3%. Other revenue (10% of total, includes Nexus hardware and search appliances) grew 48%, down from Q4's 99%.
- Google spent aggressively: Opex rose to 35% of revenue from 33% in Q4 and 31% a year ago. Capex was $2.35B (15% of revenue), up from $2.26B in Q4. Free cash flow was $2.05B, well below net income of $4.3B. Headcount (exc. Motorola) rose to 46.2K from 43.8K at the end of Q4.
- Google had $59.4B in cash at the end of Q4, +$700M Q/Q. Its Q1 tax rate was just 18%.
- Q1 results, PR
Apr. 8, 2014, 11:34 AM
- Aided by better weather, ChannelAdvisor (ECOM +4.2%) clients saw a 26.2% Y/Y increase in their Amazon (AMZN +3%) same-store sales in March, up from 23% in February and 14% in January.
- eBay (EBAY +3.1%) same-store sales rose 17.8% in March vs. 15% in February and 12.7% in January. Fixed-price sales +21.5%, auctions -10%, Motors +19.7%.
- Search ad-driven same-store sales, dominated by traffic from Google's (GOOG +3%) AdWords, rose 11.2% vs. 4.3% in February and 10.3% in January. Clicks were flat due to a shift towards Google's Product Listing Ads (PLAs). Ad prices fell 7% (soft smartphone ad prices are a likely factor), click rates rose 2%, and average order value rose 5%.
- PLA-driven same-store sales rose 34.5%. Though that's down from February's 48% and January's 62.8%, ChannelAdvisor chalks it up to "a normal aging of the program," given PLAs only launched in late 2012.
- Amazon, eBay, and Google are all posting solid gains amid a broader rebound in Internet stocks.
Apr. 3, 2014, 10:42 AM
- Both Google's new non-voting class C shares (GOOG +2.5%) and voting class A shares (GOOGL +2.6%) are posting solid gains. However, the latter are trading at a ~$1.40 premium to the former.
- By allowing Google to issue non-voting shares that don't dilute Larry Page, Sergey Brin, and Eric Schmidt's voting rights, the split could make the Web giant more willing to use equity for major acquisitions.
- Facebook, which already has a dual-class share structure that leaves Mark Zuckerberg in firm control, is set to issue over $17B worth of shares to acquire WhatsApp and Oculus VR.
Mar. 26, 2014, 1:10 PM
- Google (GOOG -0.4%) appears to have "seriously sniffed around" Oculus VR before Facebook (FB -3.8%) closed a deal to buy the VR headset maker, Kara Swisher reports. Meanwhile, The Verge reports "several big companies" had made overtures to Oculus (no names are given), and that the startup's VC investors "offered the company more money to go it alone."
- Over time, Oculus' Rift headset, which Facebook hopes will be used for many non-gaming applications, could compete against Google Glass. For now, they address different markets: Rift is much heavier/bulkier than Glass, but also provides an immersive VR/3D gaming experience.
- During a CC, Mark Zuckerberg asserted the Rift is "way ahead" of rival products such as Sony's (SNE -0.4%) Morpheus (due in 2015), and that Oculus' talent is unmatched. Oculus CEO Brendan Iribe argues Facebook's resources will help make the Rift cheaper (the dev. kit currently goes for $350).
- Stacy Higginbotham remains an Oculus skeptic: While calling a demo she tried out "immersive and neat," she adds it was "nothing like real life." Brad Stone thinks "there's nothing social" about headsets that "[blot] out absolutely everything around you."
- Jim Edwards, defending the deal, calls the Rift the kind of product for which words can't describe "how incredible the experience of wearing one is." VC Chris Dixon, who backed Oculus, makes a similar case.
- Some game developers are unhappy about the deal. As are some of the Kickstarter backers who poured $2.4M into Oculus, and only have t-shirts and dev. kits to show for it. Facebook has joined several other Internet momentum stocks in selling off in the wake of King's disappointing IPO.
- Previous: Facebook buying Oculus, more details
Mar. 6, 2014, 12:10 PM
- "Robots will become omnipresent in our lives in a good way," and in doing so will "replace a lot of the repetitive behavior in our lives," says Eric Schmidt (GOOG +0.3%) during a conference talk.
- Google has acquired a slew of robotics startups, put ex-Android chief Andy Rubin in charge of a new robotics unit, and is reportedly talking with Foxconn about using robots to automate manufacturing tasks.
- Schmidt also declares artificial intelligence will be "the biggest thing" going forward. "Technology is evolving from asking a question to making a relevant recommendation." He has previously suggested Google Now's A.I. tech could be used for enterprise analytics tasks.
- Meanwhile, sales chief Nikesh Arora predicted during a Morgan Stanley conference talk (transcript) that Google's mobile monetization will surpass its PC monetization over the long haul. "The reason I believe that is that you have so much more information and so many more signals when it comes to mobility."
- Thus far, the mobile shift has fueled an acceleration in Google's paid click growth, but has also pressured its ad prices.
- Arora adds that mobile queries for products/services tend to be more precise than PC queries - "Mobile devices lend themselves less to exploration and more towards intent" - and asserts users are becoming comfortable "having a set of payment credentials associated with their device that allows them to buy across their device."
Feb. 26, 2014, 10:43 AM
- Google's (GOOG +0.5%) DoubleClick unit is forming a display ad alliance with Russian search/online ad leader Yandex (YNDX +6%).
- Companies relying on DoubleClick's popular Bid Manager ad-buying platform will be able to purchase ad inventory offered via Yandex's real-time bidding (RTB) system. Likewise, users of Yandex's AWAPS ad-buying platform will be able to buy inventory offered via DoubleClick's Ad Exchange RTB marketplace.
- The deal doesn't cover search or contextual text-based ads. It comes a few months after DoubleClick struck a deal with Facebook to integrate Bid Manager with Facebook's FBX RTB exchange.
- RTB-based ad sales are growing at a brisk pace. eMarketer estimates they'll account for 29% of U.S. digital display ad spend in 2017, up from just 13% in 2012.
Feb. 20, 2014, 2:35 PM
- Google (GOOG +0.1%) has launched Project Tango, an initiative that (with the help of 3D sensors and a vision processor) aims to create Android phones that can track motion and create visual maps of a user's surroundings. A developer SDK and prototype phone are being released.
- Tango's underlying technology bears a strong resemblance to that found in Microsoft's Kinect sensor, or that developed by Apple-acquired PrimeSense. At the same time, startup Movidius, which is supplying Tango's vision processor, claims 3D-sensing solutions leveraging its chip consume a fraction as much power as alternatives.
- Google sees potential applications in 3D scanning, immersive gaming, and indoor navigation, among others. TechCrunch: "The idea here isn’t to create Leap Motion-like, gesture-based interfaces. It’s about ... the apps developers can create when they know exactly where a phone is in space."
- Himax (HIMX +3.2%) has moved higher thanks to the news, as investors bet Tango will lead to additional sales for the company's LCOS microdisplays (already powering Glass).
Jan. 31, 2014, 11:44 AM
- 13 sell-side firms have upped their Google (GOOG +3.6%) PTs following the company's mixed Q4 results and split announcement. Shares remain higher on a down day for equities.
- Google's market cap now stands at $395B, and its enterprise value (market cap - net cash/investments) of $342B exceeds Apple's $301B.
- Needham (Buy, PT raised to $1,350 from $1,150) is pleased with Google's accelerating international paid click growth (likely driven by mobile), and the strong performance of its "Other Google Revenue" segment (fueled by the Nexus 5 and Chromecast).
- RBC (Outperform, PT upped to $1,400 from $1,300), like others, is happy Motorola ($384M Q4 op. loss) will soon be out of the way, and notes Google's core international revenue rose 30% Y/Y. It's also pleased traffic acquisition costs remain under control, and isn't too worried heavy investments led Google's core op. margin to fall 220 bps Y/Y.
- UBS (Buy, PT raised to $1,350 from $1,300) thinks Google's cost per click (-11% Y/Y in Q4) will improve as Enhanced Campaigns and product listing ads gain more traction.
- Shares currently go for 20x 2014E EPS (exc. net cash).
- More on Google, CC transcript
Jan. 30, 2014, 5:52 PM
- After initially treading water in response to its Q4 report, Google (GOOG) has jumped to new highs. A likely factor: The company has announced a long-delayed stock split that (by creating "Class C" shares with no voting power) will further cement Larry Page, Sergey Brin, and Eric Schmidt's control over the company is set to finally take place.
- Following the split (set for April 2), Google's newly-created Class C shares will trade under the company's present symbol, while currently-traded Class A shares will trade under the symbol GOOGL.
- Google's CC (live blog) was predictably upbeat, and predictably short on specifics. Sales chief Nikesh Arora claims Google's closely-watched Enhanced Campaigns (creates joint PC/tablet search ad campaigns) is yielding strong ROIs, but doesn't provide any numbers. He also talked up YouTube's efforts to partner with Nielsen (NLSN) to measure video ad campaigns for marketers.
- Larry Page, who mentioned in October he wouldn't be joining some earnings calls, didn't join this one.
- Q4 results, details
Jan. 27, 2014, 12:44 PM
- U.S. and Chinese Internet stocks are adding to last week's big losses, as investors continue taking profits following major 2013 gains. Chinese stocks were hit last week by an emerging markets selloff, weak PMI data, and an SEC ban (pending appeal) on audits from the Chinese units of big-4 U.S. accounting firms.
- Twitter (TWTR -8.2%), the company bears are most likely to point to when arguing a new Internet stock bubble has formed, is headlining the U.S. decliners. Shares are still up 25% from their post-IPO opening trade of $45.10.
- Other U.S. decliners: GOOG -3.1%. FB -2.9%. YELP -5.3%. Z -5.1%. LNKD -4.3%. P -3.2%. ANGI -4.1%. ZNGA -3.1%. GRPN -3.1%.
- Chinese decliners: BIDU -2.9%. CCIH -19%. BITA -14.6%. CTRP -7.4%. NQ -7.9%. LONG -9.4%. DANG -7.3%. SOHU -4.3%. GOMO -5.8%. SINA -3.3%. QUNR -7.7%. SFUN -5.4%. WBAI -7.5%. RENN -5%.
- Internet/social media ETFs: FDN, PNQI, SOCL
Jan. 21, 2014, 8:17 AM
- There's a new Street-high price target of $1,450 from Google (GOOG), courtesy of Pac Crest (from $1,135) and Credit Suisse (from $1,200).
- CS: Near-term checks suggest healthy growth for O&O software in Q4 consistent with the first three quarters of 2013, while the company continues to execute against its long-term thesis.
- Pac Crest expects a solid Q4 (report on Jan. 30) thanks to strong results from search.
- Shares +0.8% premarket
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