Weekly Wrap: Earnings Roll On
By Carlo Longino, Fri Apr 25 12:35:40 GMT 2003
A slew of earnings reports hit the wires this week ...
Earnings season continued this week, with results from tons of the industry's biggest names.
Qualcomm's second-quarter net income was up 135% percent from last year, while revenues increased by about 50%. The company said the strong results were down to CDMA network launches in Asia-Pacific countries and Mexico, and increased demand in places like South Korea for CDMA-based wireless data. Some analysts, however, have expressed doubt that Qualcomm will continue to outperform the rather tepid wireless market, a view reinforced by the company's admission of oversupply in Asia and its lowering of CDMA handset sales estimates, though the company did raise its full-year guidance.
Samsung saw its mobile-phone sales grow about 14% from the previous quarter, though its average selling price fell about 5%. The company overall was hit hard by falling PC memory prices, its total profits off 41% from last year's first quarter. An interesting sidenote to these two companies' earnings releases were comments from Qualcomm execs that its relationship with Samsung (its biggest customer) remains "strong" amid reports Samsung is looking to reduce its dependence on Qualcomm for CDMA chipsets. The posing is coming from both sides, though, as Samsung named Qualcomm its "Supplier of the Year" this week, whatever that means.
Sony Ericsson's misfortunes continued as the joint venture lost EUR 104 million in the first quarter, compared to a slight profit the year before, on revenues of EUR 806 million, down about 40%. The company said it still hopes to turn a profit for the year, though many analysts have questions over the venture's future. While Ericsson announces what are expected to be pretty somber earnings (to say the least) next week, the JV's other parent, Sony took it on the chin this week, its fiscal-year earnings came in 36% lower than expected, thanks to weakness in its core electronics business.
Siemens' company-wide quarterly profit was off 56% from a year ago. The company's mobile units' figures are obscured a bit thanks to the congomerate's size and scope, though we do know the company sold only 8 million handsets in the quarter, compared to 8.3 million last year, and its networks division lost EUR 147 million in the quarter compared to EUR 158 million in the previous period.
Network gear maker Nortel spring a surprise by reporting a profit for its first quarter, earning a meager USD 54 million - hey, you gotta start somewhere - compared to a staggering USD 841 million loss in the year-ago period. The company hit profitability a quarter sooner than it had though, but warned the telecom market doesn't show any sign of picking up. Lucent posted its 12th straight quarterly loss, though it came in under analyst expectations. These two reports, of course, led to some premature prognostication that these two companies were headed back to the top.
Five of the 6 major US carriers gave their quarterly reports this week, with AT&T Wireless, Nextel, Verizon Wireless, and Cingular all posting positive results, while Sprint PCS posted a wider loss and missed expectations.
In other less financial news, tech analysts Canalys said EMEA shipments of smartphones and PDAs were up 125% in the first quarter from a year ago, with Pocket PC devices had outsold Palm OS handhelds for the first time. The report also said Symbian OS powered 91% of the smartphones sold in the region last quarter, but before any of those numbers get you too excited, they're only talking about 1.5 million smartphones and PDAs in total.
Speaking of smartphones and PDAs, Orange this week delayed release of its updated version of its Microsoft-powered device, variously called Tanager, SPVx, or SPV e100, while Palm released the Tungsten C, its first device with built-in Wi-Fi.
AOL fired the latest salvo in its instant-messaging battle with Microsoft, announcing it was joining the Symbian partner program and would develop a number of applications for Symbian devices based around its AIM and ICQ products and T9 predictive-text input technology. Microsoft's mobile OSes support MSN Messenger, AIM's biggest rival, but AOL looks to banking on the early dominance of Symbian in the smartphone operating system market to extend its popularity on PCs to mobile devices. The company also said in addition to the chat and T9 applications, it would also "have the ability" to create content-based service and other Symbian apps. Hopefully that doesn't mean they're planning to port that annoying "You've Got Mail" guy...