Thu, Apr. 23, 4:11 PM
Mon, Apr. 20, 1:55 PM
- "With the Windows 10 launch at the end of July, we are watching sort of the impact of that on the back-to-school season, and expect that it might have a bit of a delay to the normal back-to-school season inventory build-up," said AMD CEO Lisa Su during last Thursday's earnings CC (transcript).
- To date, Microsoft (NASDAQ:MSFT) has only said Windows 10 (currently in the technical preview stage) will launch at some point this summer. AMD is among the Microsoft partners likely to be given advance notice about the software giant's launch plans.
- A late-July launch would make the OS available in time for the back-to-school season, and would be well-received by a PC industry that just had a very rough Q1 caused in large part by soft enterprise and desktop demand. Windows 10 contains a bevy of enterprise-friendly features meant to win over businesses that shunned Windows 8. It will also be available as a free upgrade for users of both legitimate and pirated Windows copies, though the latter will still be viewed as unlicensed.
- Separately, Microsoft has launched Azure Service Fabric, a framework that helps developers scale and customize Azure-based services more easily. The solution relies on breaking complex apps into "microservices" that can be jointly managed and automated, and programmed via Visual Studio. It follows the March launch of Azure App Service, a cross-platform Web/mobile app development service.
- Microsoft is up strongly amid a 1.2% gain for the Nasdaq. Earnings arrive on Thursday.
Thu, Mar. 12, 9:17 AM
- Intel (NASDAQ:INTC) now expects Q1 revenue of $12.5B-$13.1B, below prior guidance of $13.2B-$14.2B and a $13.7B consensus. Gross margin guidance remains at 60% (+/- 2%), with lower volumes offset by higher ASPs.
- "All other expectations" have been withdrawn - that presumably includes full-year guidance for mid-single digit revenue growth. Guidance will be updated during Intel's April 14 Q1 report.
- The chip giant blames the warning on "weaker than expected demand for business desktop PCs and lower than expected inventory levels across the PC supply chain." In particular, it thinks "lower than expected Windows XP* refresh in small and medium business and increasingly challenging macroeconomic and currency conditions, particularly in Europe," are taking a toll on sales. Server CPU division sales are "meeting expectations."
- Other PC-exposed names are following Intel lower: Microsoft (NASDAQ:MSFT) -2.4% premarket, AMD -2.8%, Nvidia (NASDAQ:NVDA) -2.5%, HP (NYSE:HPQ) -2.3%, Seagate (NASDAQ:STX) -2.5%, Western Digital (NASDAQ:WDC) -2.7%, Micron (NASDAQ:MU) -3.6%.
- Update (11:35AM ET): While Intel is still down over 4%, Micron and Seagate have turned positive, and HP is close to breakeven. Microsoft, Nvidia, and Western Digital have pared their losses, but remain lower.
Wed, Mar. 4, 1:58 PM
- A day after slumping to new post-IPO lows and coming within $0.03 of $80, Alibaba (NYSE:BABA) has seen dip-buyers emerge in large numbers. Naturally, Yahoo (NASDAQ:YHOO) is along for the ride.
- The gains come as a Chinese publication reports Jack Ma once said he considered acquiring Yahoo, which plans to spin off its Alibaba stake into a publicly-traded company in Q4. Ma's alleged comments: "The acquisition of Yahoo is something I worked [on] a couple of years ago, this is a political problem, not an economic problem, Yahoo is a media [company], more sensitive."
- There has already been speculation Alibaba will try to buy Yahoo's spinoff (much less politically challenging than buying the whole of Yahoo) at some point. Bloomberg's Matt Levine has noted the spinoff will have to wait a year before a deal occurs, in order to maintain its tax-free status.
- Meanwhile, Alibaba's Aliyun cloud services unit (a giant in the Chinese cloud infrastructure market) has opened a Silicon Valley data center, its first in the U.S. For now, the data center will cater to Chinese companies with U.S. operations, but it plans to go after non-Chinese clients later this year. When it does, Amazon (NASDAQ:AMZN), Google (NASDAQ:GOOG), Microsoft (NASDAQ:MSFT), and a slew of other incumbents will be waiting.
Wed, Feb. 18, 12:15 PM
- Down AH yesterday due to the light sales guidance provided with its mixed Q4 results, Rackspace (RAX +1.4%) is now back above $50. Helping its cause: Pac Crest has upgraded to Outperform, and at least four firms have hiked their targets.
- Pac Crest cites enterprise and OpenStack momentum as reasons for upgrading: "In the second half of 2014, Rackspace won more large enterprise contracts worth at least $100,000 per month than it had in the prior five quarters combined ... management indicated that OpenStack now makes up more than 50% of its public cloud revenue, which implies OpenStack revenue is at least 15.6% of its total revenue."
- Cowen (target hiked to $75) now considers it likely Rackspace "will announce support for a mega cloud provider in 1H15," thereby boosting its long-term addressable market and lowering future capex needs (in exchange for sharing revenue). It adds sales guidance was in-line after adjusting for forex, and that EBITDA margin guidance was better than expected.
- Meanwhile, new CEO Taylor Rhodes argues the cloud infrastructure (IaaS) market's price war is calming down. "Amazon Web Services (NASDAQ:AMZN) in November, for the first time, didn’t make a price cut move ... AWS is feeling like they are the reference brand leader, that they are strong versus Google (NASDAQ:GOOG), so they don’t need to do it as much. Microsoft (NASDAQ:MSFT) is cutting price, but who knows how much share they are actually taking."
- He also reiterates Rackspace's assertion that its OpenStack/hybrid cloud offerings are differentiated in the battle for enterprise accounts. "The mainstream market has two problems: They have legacy apps that won’t go [to multi-tenant public clouds] automatically ... the second problem they have is this skills set gap ... There is a need for software and tools development."
- Q4 results, guidance/details
Tue, Feb. 17, 10:30 AM
- 7 of the 8 firms launching coverage on Box (BOX -2.6%) following the end of its underwriter quiet period have provided neutral writing, generally citing valuation as their reason for doing so.
- Though launching coverage at Neutral due to the company's multiples, JPMorgan praises "Box's differentiated focus on rich and complex features for corporate IT departments, spanning security, compliance, workflow and auditing."
- Morgan Stanley (Equal-Weight) predicts "a growing enterprise ecosystem will offset competitive pressures over time," but also considers a current enterprise value of 7x 2016E sales fair in light of "near-term limits on growth and margins."
- Credit Suisse (Outperform) is the sole firm to give Box a bullish rating, arguing the company offer a better enterprise file-syncing/sharing platform than top rival Microsoft, and that it "has sufficient lead time to further improve its competitive position and expand its user base."
- Speaking of Microsoft (NASDAQ:MSFT), Box has announced it's joining Citrix and Salesforce as initial members of the software giant's Cloud Storage Partner Program. The deal allows Box's services to be integrated with the Office iOS apps, and more deeply connected to Office Online. Box/Office 365 integration already exists, as does a partnership between Microsoft and Dropbox.
- Previously: Box CEO makes long-term case
Wed, Feb. 4, 2:53 PM
- TechCrunch reports Microsoft (MSFT +0.9%) has acquired Sunrise, a developer of mobile (iOS/Android) and cloud-based calendar apps, for a price of "at least $100 million."
- Sunrise's apps respectively have ratings of 4.5/5 and 4.3/5 stars on the App Store and Google Play; Google Play reports seeing 500K-1M installs. The apps sync/integrate with Microsoft Exchange, Google Calendar, Eventbrite, and iCloud. TechCrunch reports hearing the apps will remain available on a standalone basis.
- The report comes two months after Microsoft, which has done much to boost its cross-platform credentials in the Satya Nadella era, bought iOS/Android e-mail app developer Acompli for a reported $200M+. Acompli's app underpins new Outlook mobile apps launched by the software giant.
- Two weeks ago: Microsoft shows off HoloLens, new browser, universal apps
Tue, Jan. 27, 12:40 PM
Tue, Jan. 27, 9:22 AM
- After selling off yesterday in response to Seagate's guidance, Intel (NASDAQ:INTC) and HP (NYSE:HPQ) are showing steep losses in premarket trading today after Microsoft (NASDAQ:MSFT) reported 13% Y/Y drops in both its Windows OEM Pro and non-Pro revenue, and offered conservative guidance. Microsoft is down 8.3%, and Nasdaq 100 futures are off 1.4%.
- Microsoft blamed the Windows OEM Pro decline on slowing business PC demand (following a boost driven by the end of Win. XP support), an unfavorable mix, and academic discounts. The OEM non-Pro decline was blamed on a mix shift towards cheaper hardware for which the software giant has cut or eliminated Windows licensing fees.
- Microsoft's server/data center-related sales were healthier: Server product/services revenue rose 9%, and commercial cloud revenue (Office 365/Azure) grew 114%. But on the CC (transcript), the company stated transactional server revenue "was down primarily due to a declining traditional server market." A shift in demand towards Web/cloud data centers often relying on Linux servers might also be a factor here.
Tue, Jan. 27, 9:10 AM
Tue, Jan. 27, 7:43 AM
- "After a lengthy 16-month period of multiple expansion for Microsoft’s (NASDAQ:MSFT) stock, we see a tougher transition ahead, and move to the sidelines," says Nomura's Rick Sherlund, cutting to Neutral with the price target lowered to $50 from $56.
- JPMorgan downgrades to Neutral with price target cut to $47 from $53.
- Never a big fan in the first place, Citi cuts to Sell from Neutral.
- MKM Parters downgrades to Neutral.
- Shares -7.8% premarket
- Previous earnings coverage
Mon, Jan. 26, 4:42 PM
- Microsoft's (NASDAQ:MSFT) Window OEM Pro and non-Pro revenue both fell 13% Y/Y in FQ2. The Pro slowdown is blamed on slowing business PC sales, academic discounts, and "mix returning to pre-Windows XP end of support levels." The non-Pro decline is due to unit growth coming from cheaper hardware that Microsoft is providing discounted license fees for. Commercial Windows volume license revenue rose 3%.
- Total Commercial revenue rose 5% Y/Y in FQ2 to $13.3B, helping drive the revenue beat. Devices & Consumer revenue (lifted by the Nokia deal) rose 8% to $12.9B. Commercial reporting segments accounted for over 2/3 of FQ2 gross profit of $16.3B.
- Segment performance: Commercial licensing revenue -2% Y/Y to $10.7B (hurt by the cloud shift). Commercial other +46% to $2.6B (boosted by cloud growth). Device/consumer licensing -25% to $4.2B (Windows and Android royalty declines). Computing/gaming hardware -11% to $4B (Xbox One launched a year ago). Phone hardware revenue was $2.3B, above guidance of $2B-$2.2B but down from FQ1's $2.6B (feature phone decline).
- Highlights: 1) Commercial cloud revenue (Office 365, Azure, Dynamics online) +114% Y/Y, and now on a $5.5B/year run rate 2) 10.5M Lumias and 6.6M Xboxes were sold. Surface revenue +24% to $1.1B. 3) Server products/services +9%, with double-digit SQL Server and System Center growth. 4) Search ad revenue +23%; Bing's U.S. share is at 19.7% (per comScore).
- With Nokia boosting spending levels in spite of last year's job cuts, R&D spend rose 6% to $2.9B, and sales/marketing 7% to $4.3B. G&A, however, fell 8% to $1.1B.
- $2.1B was spent on buybacks. Microsoft plans to complete its existing $40B buyback program (launched in Sep. 2013) by the end of 2016.
- Microsoft is at $45.59 in AH trading. Guidance will be provided on the CC.
- FQ2 results, PR
Fri, Jan. 23, 6:19 PM
- BOX closed up 65.4% from its $14 IPO price, leaving it with a $2.77B market cap (15% above the valuation for its last funding round). 41.4M shares changed hands, or 3.3x the 12.5M sold through its IPO (before factoring the overallotment option).
- Co-founder/CEO Aaron Levie, best known to some for his Twitter one-liners, made the rounds today, arguing more than once his company's offerings are well-differentiated from the aggressively-priced cloud storage/file-sharing services of tech giants.
- Levie during a talk with Barron's: "What we’ve built really is software to help manage and collaborate and share throughout the business ... ultimately our customers buy our solution because we have built an amazing product to manage all that content. We get compared to more storage-oriented products, but there’s more to it."
- He called Microsoft (NASDAQ:MSFT), whose SharePoint collaboration platform is widely deployed and which is now offering unlimited OneDrive storage to Office 365 subs, Box's biggest competitor, but also one Box can stand out relative to. "I think our real differentiation is we do all the enterprise-oriented delivery, the industry compliance for FINRA, the security, and all that — but the really unique part is we deliver that in a consumer-grade experience, with open APIs, and that works across platforms."
- Levie suggests to Forbes Box will focus going forward on giving clients more tools for using/interpreting data, pointing to its recent acquisition of medical image-sharing platform MedXT as an example. He also notes Box is investing in industry-specific machine learning tools that analyze content to organize, surface, and recommend documents.
- Prior Box coverage
- Prospectus, IPO analysis
Wed, Jan. 21, 2:35 PM
- Microsoft (MSFT -1.6%) has followed up on its Windows 10 reveal by unveiling new hardware. Getting the most attention is HoloLens, a headset declared to be "the most advanced holographic computer the world has ever seen."
- The device contains a see-through display that allows users to see holograms in their real-world environments, and doesn't require a connection to a PC or phone. Microsoft has christened the augmented reality platform underpinning it Windows Holographic.
- HoloLens is expected to launch around the same time as Windows 10. LCoS microdisplay vendor Himax (HIMX +5.4%), previously rumored to be working with Microsoft, has spiked higher.
- Also unveiled: Surface Hub, an 84" 4K touch display sporting dual cameras and sensors, running Windows 10, and providing quick access to Skype video calls and a digital whiteboard. The product, which presumably won't be cheap, appears to be aimed at conference rooms.
- As rumored, Microsoft's Spartan browser sports a streamlined UI, Cortana integration, a note-taking/annotating stylus mode, and a new rendering engine that delivers improved performance. It also has a Reading Mode that formats Web pages to resemble e-books.
- A slew of new universal apps (they feature similar PC and phone/tablet UIs) have been shown off. OneDrive, a photos app, and a People app are among the covered products. New Office apps for phones and small tablets have been previewed, and so has the ability to run universal Windows apps on the Xbox One.
- Earlier: Microsoft details Windows 10, promises free upgrades
Dec. 18, 2014, 2:04 PM
- With the help of stronger-than-expected hardware sales, Oracle (ORCL +9.2%) beat FQ2 estimates in spite of a 400 bps forex headwind (twice what was originally expected). FQ3 guidance was conservative after taking forex pressures into account.
- The numbers have been good enough for Oracle to surge to new highs and receive a slew of target hikes, and to lead many enterprise tech names to outperform amid a big market rally. The Nasdaq is up 1.9%.
- Microsoft (MSFT +3.2%), Cisco (CSCO +2.3%), EMC (EMC +3.7%), VMware (VMW +5.1%), and beaten-down IBM (IBM +2.8%) are among the enterprise tech names outperforming today. Others: SPLK +4.6%. CA +3.5%. RHT +3.4%. VRNS +6.3%. PCTY +5.8%. JIVE +4.6%. VMEM +5.2%. SAAS +4.7%. BRCD +3.8%.
- Oracle's healthy cloud software numbers are drawing attention: While traditional software license revenue fell 4% Y/Y, its SaaS/PaaS revenue rose 41%. SaaS/PaaS bookings totaled $170M, and are expected to be "well over" $1B in FY16 (ends May '16). Fusion cloud app bookings rose over 100%.
- On the CC (transcript), Oracle performed its customary trash-talking of cloud app rivals. "We are clearly growing faster than Salesforce (CRM +4%) and were more than three times the size of Workday (WDAY +3.2%)." Both firms are posting solid gains.
- Oracle's numbers come as Bloomberg reports the Chinese government is looking to "purge most foreign technology from banks, the military, state-owned enterprises and key government agencies by 2020." IBM, Cisco, and other U.S. firms have already seen their Chinese sales fall sharply following last year's NSA spying uproar.
Dec. 16, 2014, 8:38 AM
- Microsoft's (NASDAQ:MSFT) outperformance of late is concerning, says analyst Kash Rangan downgrading to Underperform with $47 price target; especially in an environment of a slowing Win Pro cycle, an "elongated" Consumer Office 365 transition, the challenge of margin leverage, and sell-side exuberance over one-time financial moves.
- Under a "best case" scenario of a $30B buyback and $4B in operating expense cuts, Microsoft could run out of room for earnings growth, leading to a re-rating of the P/E ratio.
- Shares -1.3% premarket
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