Update Intel (INTC)
Blow out quarter. Stunning increase in guidance. A totally justified 4.3% gain in the after-hours market on the day it announced earnings.
Now we’ll see if Intel (INTC) can juice the rest of the technology sector. (Look today to see how Microsoft (MSFT) reacts, for example.)
After the market closed on April 13 Intel announced earnings of 43 cents a share. That was 5 cents above Wall Street projections. Earnings for the first quarter of 2009 came to 11 cents a share. Revenue increased by 44% to $10.3 billion. Analysts had projected $9.84 billion. Gross margin climbed to 63.4%. That was above the company’s January forecast of 59% to 63%.
But the good news didn’t stop with the current quarter. Read more
Today’s earnings from Intel will set the tone for tech stocks–and the market as a whole
Intel (INTC) reports first quarter 2010 earnings today, April 13, after the close.
The market’s reaction to Intel’s numbers will tell us more about the market than about this technology stock. (For more on the prospects for earnings season as a whole se my post http://jubakpicks.com/2010/04/06/are-stocks-headed-for-an-earnings-season-of-selling-on-the-good-news/ ) Read more
Update Marvell Technology Group (MRVL)
After the market closed yesterday (March 4) Marvell Technology Group (MRVL) reported fourth quarter fiscal 2010 earnings of 40 cents a share (excluding items). That was 3 cents a share above the official Wall Street consensus. Revenue climbed 64% from the fourth quarter of fiscal 2009 to $843 million, just a tad above analyst consensus. Strength came in storage (sales up 5%) and networking (sales up 10%).
The best news in the current quarter, however, came on gross margins, which climbed 2.2 percentage points to hit 60%. That’s an all-time high for the chip company and is significantly above the 58.6% gross margin expected by Wall Street.
Normally the first quarter of the company’s fiscal year—the quarter that ends in April—shows a 7% to 10% seasonal decline in sales. In that context Marvell Technology Group’s guidance to Wall Street for a flat to 2% decline in that quarter counts as a sign of major continuing strength for the company. So too does the company’s increase in gross margin targets going forward to 58% to 60%. That indicates that Marvell believes the new margins are sustainable and the savings from its cost reduction program aren’t based on one-time gimmicks.
The conference call wasn’t completely sunshine and buttercups, however. Read more
Update Qualcomm (QCOM)
Companies have characters.
If you had a friend like Intel (INTC), for example, you know he’d be up late at night figuring out a way to make the family car run just a bit better than everyone else’s.
If you had a friend like Wal-Mart (WMT), you wouldn’t be surprised to find him out in his backyard on a Saturday building a big shed to hold all the stuff he bought cheap in bulk.
And if you had a friend like Qualcomm (QCOM), he would drive you crazy by never telling you what he was going to do until well after it happened.
I’ve owned Qualcomm off and on over the last decade and I’ve got the scars to prove it. This company just can’t seem to figure out how to tell Wall Street when enthusiasm is running too high and earnings are about to disappoint.
And that’s exactly what happened—again—when the company announced earnings for the first quarter of the 2010 fiscal year after the market close on January 27.
The problem wasn’t what the company said about earnings for the just completed quarter. Qualcomm reported earnings of 62 cents a share, 6 cents a share above Wall Street expectations.
It was the surprisingly dour guidance for the second quarter that did the damage. Second quarter revenue will be just $2.4 billion to $2.6 billion. That’s way below analyst projections of $2.75 billion.
For the entire fiscal 2010 year the company told investors to expect $2.10 to $2.30 a share in earnings (Wall Street had been looking for $2.26) and revenue of $10.4 billion to $11 billion (Wall Street had projected $11.06 billion.)
Where did that come from? The guidance left analysts and investors scratching their heads. How come a company that is clearly beating competitors, gaining market share, and rolling out impressive new products at the rate that Qualcomm is won’t turn in better results for 2010?
Qualcomm should be cooking on all burners? So what’s wrong? Read more
Update Taiwan Semiconductor (TSM)
Everything is working out exactly as I planned when I bought Taiwan Semiconductor Manufacturing (TSM) on October 20, 2009—with the small exception of the share price.
When the company reported fourth quarter 2009 earnings on January 28, it confirmed the two major parts of my investment thesis.
First, a global recovery in the PC, wireless handset, and digital consume product markets has started to drive up sales. In the fourth quarter sales grew by 43% from the fourth quarter of 2008. For 2010 Taiwan Semiconductor forecast a 29% growth rate for the semiconductor foundry industry. Read more
