Seeking Alpha

Microsoft Corporation (MSFT)

  • Jan. 17, 2014, 11:37 AM
    • Intel's (INTC -3.6%) partial blaming of weaker-than-expected Q4 server CPU division sales (revenue +8% Y/Y, but volumes only +1% Y/Y and -3% Q/Q) on a government shutdown comes across as a "bad excuse," thinks FBR.
    • Though reiterating an Outperform, FBR is skeptical about Intel's long-term 15% revenue CAGR target for its server CPU division. Bernstein questioned the division's growth outlook yesterday afternoon.
    • Goldman, reiterating a Sell (previous), says Intel's numbers "confirm our view that there is downside, not upside, to Intel's 2014 EPS." It's worried about both server CPU sales and a softening corporate PC upgrade cycle (driven by the Windows 7 transition) following Q1.
    • JPMorgan, which upgraded Intel going into earnings, is defending the company. It's pleased with stabilizing PC demand and dismisses server concerns, given sales have historically been volatile.
    • A major headwind faced by Intel's server CPU unit: Server industry revenues have been steadily declining, as demand shifts towards Web/cloud service providers with bigger economies of scale and a penchant for using cheap white-label hardware. IDC estimates total server sales fell 3.7% Y/Y in Q3, and that x86 server sales rose just 2.8%.
    • Microsoft (MSFT -1.6%) and AMD (AMD -1.1%) are ticking lower following Intel's report. So are server virtualization kingpin VMware (VMW -1.9%), parent EMC (EMC -0.9%), and rival Citrix (CTXS -0.8%). Intel suggested on its CC virtualization growth is softening.
    • More on Intel's Q4, CC transcript
    | 1 Comment
  • Jan. 17, 2014, 3:48 AM
    • Nintendo (NTDOF) has warned that it expects an operating loss of ¥35B ($336M) for the fiscal year through March instead of a profit of ¥100B, as the company had previously forecast. Analysts predict ¥54.7B.
    • Nintendo also projects a net loss of ¥25B vs a previous outlook for a profit of ¥55B, and it has cut its revenue estimate by 36% to ¥590B. The company will pay an FY dividend of ¥100 instead of ¥260.
    • Nintendo said the dramatic reversal was due to much lower-than-expected sales of its Wii U and 3DS games machines during the holiday season. That might have something to do with the success of Sony's (SNE) PlayStation 4 and Microsoft's (MSFT) Xbox One, both of which were launched in the run up to Christmas.
    • Nintendo now expects FY Wii U sales of 2.8M instead of 9M and 3DS sales of 13.5M vs 18M. The firm also cut its software outlook. (PR here and here.)
  • Oct. 25, 2013, 10:33 AM
    • "Our recent upgrade was based on the transition to the cloud, transparency for the 'BestCo' commercial assets and optionality on assumed low intrinsic value for Windows ... F1Q14 was positive for all these trends," writes Jefferies' Ross MacMillan, gloating about his recent bullish call on Microsoft (MSFT +6.6%) in the wake of the FQ1 beat. Nonetheless, he's slightly lowering his EPS estimates due to margin pressure related to the Xbox One launch.
    • Microsoft's Windows OEM "Pro" (enterprise) revenue rose 6% YY in FQ1, while "non-Pro" (consumer) revenue fell 22% (17% exc. China), several points better than expected.
    • On its earnings call (transcript), Microsoft guided for Devices & Consumer licensing revenue of $5.2B-$5.4B for seasonally strong FQ2. Business PC demand is expected to be steady, but consumer demand  will be"subject to more volatility." Hardware revenue is expected to rise 35%-45% Y/Y to $3.8B-$4.1B, aided by the Xbox One launch.
    • Microsoft's total commercial revenue is expected to grow 9%-11%, on par with FQ2. Commercial licensing revenue is expected to come in at $10.7B-$10.9B, and Commercial Other revenue (inc. Azure and Office 365) is expected to grow to $1.7B-$1.9B from FQ1's $1.6B. Opex is expected to rise 6%-8% Y/Y.
    • FQ1 results, details, slides (.ppt)
  • Oct. 24, 2013, 4:43 PM
    • Microsoft's (MSFT) new Commercial Licensing reporting segment (inc. Office and Server & Tools licenses, as well as enterprise Windows sales) posted 7% Y/Y revenue growth in FQ1, and accounted for 66% of the software giant's gross margin. Healthy growth for SQL Server, Lync, and SharePoint fueled the increase.
    • "Commercial cloud" sales rose 103% Y/Y, contributing to a 28% increase in Commerical Other revenue.
    • Windows OEM sales only fell 7% Y/Y after dropping 15% in FQ4. Surface revenue came in at $400M. Overall, Microsoft's Devices and Consumer Licensing revenue fell 7% Y/Y, and D&C hardware rose 37%. D&C Other, which includes Internet services, posted 17% sales growth.
    • MSFT +5.8% AH. FQ1 results, PR
    • Previous: Microsoft's new reporting segments
  • Oct. 24, 2013, 4:07 PM
    • Microsoft (MSFT): FQ1 EPS of $0.62 beats by $0.08.
    • Revenue of $18.53B (+16% Y/Y) beats by $740M.
    • Shares +5.8% AH. CC at 5:30PM ET. (PR)
  • Oct. 24, 2013, 12:10 AM
  • Oct. 23, 2013, 5:35 PM
  • Oct. 21, 2013, 3:26 AM
    • Sales of Nokia's (NOK) Lumia phones reportedly rose to at least 8M devices in Q3 from 7.4M in Q2, with the figure more than double that of Q3 2012.
    • The speculation comes ahead of an event in Abu Dhabi tomorrow, where Nokia is set to launch six new products, including the company's first tablet computer and phablets.
  • Jul. 18, 2013, 6:36 PM
    Windows OEM revenue (65% of division sales) is expected to show a "mid-teens" adjusted Y/Y drop in FQ1, Microsoft (MSFT) states on its FQ4 CC. OEM sales fell 15% in FQ4, as a 20%+ drop in consumer sales and pricing "incentives" offset healthy enterprise demand. CFO Amy Hood says Microsoft is still looking at ways to adjust Windows pricing, including for smaller devices. Server & Tools is expected to grow in the high-single-digits again. The Office division's business sales (85% of total) are seen growing in the mid-single-digits; consumer sales will be soft. Entertainment & Devices is seen declining in the low-single-digits ahead of the Xbox One launch. Capex is expected to keep growing thanks to Azure investments. Shares -6.4% AH. (FQ4: I, II) (slides - .ppt) (prepared remarks - .doc)
  • Jul. 18, 2013, 4:47 PM
    More on Microsoft: $900M ($0.07/share) charge taken on Surface RT inventories. FQ4 Windows division revenue -6% Y/Y adjusted for Win. 8 pre-sales, +6% otherwise (flat and +23% in FQ3). Division OEM revenue -15% adjusted, +1% otherwise. Office division revenue (affected by subscription shift) +2% adjusted for pre-sales, +14% otherwise (+5% and +8% prior). Server & Tools +9% (+11% prior). Online Services +9%, op. loss of $372M (up from FQ3's $262M). Entertainment & Devices (Xbox, Skype, etc.) +8% (+33% prior). Office 365 now on $1.5B+ run rate (up from $1B+ in April). Opex (exc. charges) +9% Y/Y. Unearned revenue balance +12% Y/Y to $22.4B. MSFT -5% AH. (PR)
  • Jul. 18, 2013, 4:08 PM
    Microsoft (MSFT): FQ4 EPS of $0.66 misses by $0.09. Revenue of $19.9B (+10% Y/Y) misses by $830M. Shares -4.2% AH. CC at 5:30PM ET (webcast). (PR)
  • Jul. 18, 2013, 12:10 AM
    Notable earnings after Thursday’s close: GOOG,MSFT, AMD, CMG, ISRG, SWKS, SYK, COF, BGS , RMBS, PBCT, CBST, ACTG, ATHN, CPHD,ALGN, CE, WAL, CYT
    | Comment!
  • Jul. 17, 2013, 5:35 PM
    Notable earnings after Thursday’s close: GOOG,MSFT, AMD, CMG, ISRG, SWKS, SYK, COF, BGS , RMBS, PBCT, CBST, ACTG, ATHN, CPHD,ALGN, CE, WAL, CYT
    | Comment!
  • Apr. 19, 2013, 1:26 PM
    Cost controls, Office/Server & Tools strength, and perhaps the news of CFO's Peter Klein's pending departure are helping Microsoft (MSFT +3.2%) trade near $30 again following its FQ3 report. Bernstein, encouraged by the Office 365 disclosure, thinks "Microsoft is already the 2nd largest enterprise cloud vendor," with a $1.4B-$1.6B/year run rate (ed: Microsoft's estimated FY13 revenue is $79B). ReadWrite's Mark Hachman, however, doesn't like the fact no fresh details are provided on Win. 8 licenses. If Klein was pushed out, he doesn't suggest it in a memo. (CC transcript)
  • Apr. 18, 2013, 7:16 PM
    Microsoft (MSFT) is working with OEMs on "small devices powered by Windows," outgoing CFO Peter Klein confirms - given past reports, that's not too surprising. Microsoft's reasons why Windows division revenue was healthy in spite of PC weakness: Surface sales and volume licenses to enterprises. OEM Windows revenue (+17%) was bolstered by Win. 8 deferred revenue recognition, but that won't last. Server & Tools remains strong: multi-year licensing revenue rose 20%, System Center revenue +16%, and SQL Server +22%. Office division multi-year licensing +16%; Office 365 is on a $1B/year run rate. MSFT +2.7% AH. (FQ3: I, II) (slides) (prepared remarks)
  • Apr. 18, 2013, 4:50 PM
    More on Microsoft's FQ3: GAAP EPS beat estimates, revenue missed slightly. Windows division revenue flat Y/Y adjusted for Windows 8 pre-sales, +23% otherwise (was +11% and +24% in FQ2). Office division revenue +5% adjusted for Office 2013 pre-sales, +8% otherwise (+3% and -10% prior). Server & Tools +11% (+9% prior), 26% of op. profit. Online Services +18%, division loss down to $262M.  Entertainment & Devices (Xbox, Skype, mobile) +33% adjusted. FY13 opex guidance lowered to $30.2B-$30.5B from $30.3B-$30.9B. Preliminary FY14 opex guidance of $31.6B-$32.2B. MSFT +1.9% AH. CC at 5:30PM ET (webcast). (PR)
Visit Seeking Alpha's
MSFT vs. ETF Alternatives
Company Description
Microsoft Corp is engaged in designing, manufacturing, selling devices, and online advertising to a global customer audience. Its products include operating systems for computing devices, servers, phones, and other intelligent devices.
Sector: Technology
Country: United States