Sun Microsystems earned a piddly $88 million on $3.78 billion in sales for the second quarter. The company is still trying to recover from a $5 billion loss after the dot-com bust killed the market for its servers. Massive layoffs and restructuring have run up additional charges. But there's an upside: Analysts had expected worse. The Valley's former destination of choice for overachieving young engineers may yet save itself.
In a conference call to discuss CBS's quarterly results, CEO Les Moonves pointed to the recently announced selloff of radio stations and acquisition of CNET as an effort to jumpstart growth. Profits for the quarter were up a measly 1 percent, and the stock price was down slightly on the news. Moonves is looking for the CBS Interactive division to grow its annual revenue to $1 billion in three years.That's presuming online ad industry growth matches expectations despite a larger economic downturn, which Moonves assures us all it certainly will. In fact, the 50 percent target is modest; it translates to 14.5 percent a year. Which means Moonves is assuming that CBS Interactive will underperform the online-advertising market, which is expected to grow 20 percent a year or more. (Photo by Getty/Vince Bucci)
Someone forgot to tell Comcast that by slowing down BitTorrent and only appointing a single Twitter Appeasement Specialist, the company had banished itself to the long tail of failure. The world's most hated ISP reported $632 million in earnings on $8.55 billion in revenue. Wall Street analysts had expected closer to $700 million, but investors kicked the stock upwards anyway. Traders beware: Silicon Valley now has a hundred influencers who will blog Comcast out of business in Q3. Dump now! (P.S. Firefox doesn't think "influencer" is a word.)
In the second quarter, IAC swung from a $94.6 million profit last year to a $421.6 million loss this year. Don't blame Jakob Lodwick! His former company, Vimeo, is nowhere near the top of IAC/InterActiveCorp's expense report for the past quarter. The real problem at Barry Diller's Internet empire is Cornerstone Brands, a rollup of catalog companies undermined by weak consumer spending in home and apparel retail. Cornerstone's losses led to a $300 million writedown in goodwill in IAC's second quarter. In addition, the soft real estate market cut revenue for home financing site LendingTree nearly in half.IAC is moving ahead with plans to spin off four of its divisions by the end of August: HSN (which includes Cornerstone), Ticketmaster, Tree.com (which includes LendingTree), and Interval Leisure Group, which operates vacation sites including ResortQuest Hawaii. That leaves IAC with Ask.com, Match.com and Citysearch. What's happening? Simple: Diller and company have learned that bundling a bunch of diverse online businesses together doesn't create the promised "synergy" of the Web 1.0 boom. Better to let each site fend for itself. Since IAC got rid of Expedia in 2005 (Barry Diller's still chairman of the board), the travel site's ups and downs have closely followed the travel market. That's the watercooler version. You can wonk out with the full details.
Amazon.com beat Wall Street expectations in reporting its second-quarter earnings today. Profits were up 41 percent to $158 million, compared with $78 million during the second quarter last year. Revenues hit $4.06 billion, better than the $3.95 billion expected by Wall Street analysts. Shares up are 3 percent in afternoon trading. [Reuters]
Yahoo reported second-quarter profits of $131 million, down from $161 million the first quarter. Even after lowering their expectations, Wall Street analysts hoped the company would report profits of $140 million. The company also missed on revenues, reporting $1.35 billion in revenues after payments to Web publishers which carried Yahoo-sold ads. Wall Street wanted $1.37 billion. Hoping to breed some optimism, CFO Blake Jorgensen told Reuters Yahoo has not changed its financial guidance for 2008, despite advertising woes.
After giving a lower forecast for its September quarter than Wall Street expected, Apple saw its shares drop 3 percent today. TheStreet.com's Jim Cramer says not to blame the numbers, but the numbskull PR move Apple made in refusing to discuss plans for Jobs's successor. "Look," Cramer says in the clip embedded below, "I thought the forecast was great. This is all about [Apple saying] Jobs's health is a 'personal matter."
Apple beat Wall Street estimates for its latest quarter's revenues and profits yesterday, but worried shareholders with unimpressive guidance for the next quarter. During the conference call, Apple executives refused to answer an analyst's question about CEO Steve Jobs's health, replying: ""Steve's health is a private matter." Silicon Alley Insider's Henry Blodget disagrees:
Apple reported numbers for its third fiscal quarter today: Based on the sales of 2,496,000 Macs and 11,011,000 iPods, Apple generated revenues of $7.46 billion and a net profit of $1.07 billion. In the same time period last year, Apple's revenue was $5.41 billion, with a profit of $818 million. Apple didn't release numbers for iPhone sales — those come next quarter. Steve Jobs, skipping over talk of his health, also hinted at more new product releases in the coming months. New products from Apple? Yes, we're not shocked, either.
Quarterly earnings reports are supposed to be about a public company's financial health, but during today's call, Apple's institutional investors want a checkup on CEO Steve Jobs. They haven't gotten over Jobs's overly thin appearance at WWDC in June. "Apple's hedge-fund investors are very worried," a Wall Street source tells the New York Post. In the weeks following WWDC, Apple told reporters Jobs looked so ill because of antibiotic treatments for a cold.
Microsoft reported a first quarter net income of $4.3 billion. Revenues were $15.84 billion, up 18 percent over the same quarter last year. Not good enough for Wall Street, which pitched the stock price down 5 percent in off-hours trading after learning that Microsoft expects $14.7 billion to $14.9 billion in revenues during the third quarter, not matching the street's hopes for $15.04 billion. Microsoft blamed hiring and investments in online, though its business apps business was the real stinker last quarter, growing less than Wall Street expected it would [WSJ]
Google reported revenues of $5.4 billion for 2008's second quarter, which after payments to Web publishers which carry Google-sold ads, comes to $3.9 billion, just $30 million ahead of Wall Street's expectations. Second-quarter revenues grew 39 percent over the same period last year and increased 3 percent from the first quarter of 2008. Google earned $1.25 billion in profits in the quarter, down from $1.31 billion in the first. In statement, CEO Eric Schmidt said "Strong international growth as well as sustained traffic increases on Google's web properties propelled us to another strong quarter, despite a more challenging economic environment." Wait — we thought Google was immune to such paltry outside influences. Guess not: Google operating expenses in the second quarter of 2008 included $810 million in payroll-related and facilities expenses, compared to $809 million in the first quarter of 2008, which means the company's made sure to clamp down on expenses. Live coverage of Google's second quarter 2008 earnings call, below.
Lately, there's been a downturn in the ad market. Even online advertising isn't growing as fast as it used to. But don't expect these macroeconomic trends to effect Google's second-quarter earnings report today. Google isn't a bellwether for the economy, CEO Eric Schmidt told reporters in Idaho last week. "We make our own weather," he said. With those remarks in mind, we'll let analysts like Citi's Mark Mahaney — who created the useful cheat sheet above — tell you what kind of numbers to expect today. Our forecast for today's earning's call instead? A downpour of arrogance and gutters full of gloating.
ValueClick preannounced their second-quarter earnings early today, reporting revenue between $163 milllion and $164 million, below the online-advertising company's expectations of $166 million to $170 milllion. As of this morning, company shares are down 18.52 percent. In a release, ValueClick CEO Tom Vadnais blamed a "increasing macroeconomic uncertainty" which the company said "negatively impacted revenue in the quarter, primarily in the U.S. comparison shopping and U.S. display advertising businesses." But are we in an ad recession, or did ValueClick whiff their quarter and need an excuse?
eBay's second-quarter net income rose 22 percent to $460 million, as PayPal and other newer businesses led broad-based growth. The total value of all goods sold on the site in the quarter was $15.7 billion, up 8 percent from a year ago — which suggests that the sustained whining of smaller sellers who are displeased by the inclusion of listings from the likes of Buy.com, which pays lower fees to sell items on the site, has mattered less than new sales generated by the larger merchants. [Wall Street Journal]
"Intel announced its second quarter results (PDF) today, with numbers that beat analyst expectations and set revenue records for the company. Total Q2 revenue for 2008 was $9.5 billion, with an operating income of $2.3 billion, net income of $1.6 billion, and earnings-per-share of 28 cents. Total revenue fell two percent from the first quarter's results, but improved nine percent year-on-year, while net income rose by 11 percent compared to Q1 2008, and 25 percent compared to Q2 2007." [Ars Technica]
Year-over-year revenues are up 19 percent at Adobe in the most recent quarter, driven mostly by sales of the new CS3 versions of popular applications such as Photoshop. (Even bloggers use it!) But there was little growth in revenues derived from mobile markets as the company struggles to make its Flash Web-video technology the go-to media software for phones and other devices. On the iPhone front, the company has Flash running on an emulator, but in Cupertino, Apple is developing its own alternative. [ZDNet]
