Displaying items by tag: profits

IBM has reported a 2.5% decrease in revenues for the third consecutive quarter this year.

For the third quarter of 2020, the US tech company reported $17.6 billion compared to $18 billion in the corresponding quarter last year.

However, their net income experienced a slight increase, amounting to $1.7 billion due to the company’s cost-cutting strategies, according to the earnings report.

Shares were reportedly down by 2.6% in after-market trades however, it experienced some growth in its cloud computing business. In fact, IBM shares are down 6% since the beginning of the year.

Published in Reports

US technology behemoth Microsoft is edging nearer a trillion-dollar valuation after its profits soared in the first-quarter of 2019. Microsoft enjoyed the increase in its revenues largely because of its cloud and business services continue to resonate with the market.

Profits’ in the opening quarter climbed by 19% to $8.8bn and that represents an increase of 14% from the same period a year earlier. Microsoft also saw its shares gain 3% on the New York Stock Exchange which pushes it closer to a $1 trillion valuation.

By the close of the bell on Wall Street, Microsoft was valued at $960m, which places them just behind Apple and slightly ahead of Amazon.

The financial results indicate that Microsoft is now becoming increasingly reliant on cloud computing and other business services which now drive its earnings, in contrast to its earlier days when it focused on consumer PC software.

“Leading organizations of every size in every industry trust the Microsoft cloud," chief executive Satya Nadella said in a statement.

Commercial cloud revenue rose 41 percent from a year ago to $9.6 billion, which now makes up nearly a third of sales, Microsoft said.

In addition to this, it was disclosed that some $10.2 billion in revenue came from the productivity and business services unit which includes its Office software suite for both consumers and enterprises, and the LinkedIn professional social network.

The more personal computing unit which includes its Windows software, Surface devices and gaming operations generated $10.6 billion in the quarter.

Published in Finance

Australia’s leading telecommunications company Telstra has reported a slump in first half profit - as the combination of increased competition in the market and a shift towards digital have had a significant impact. Its fixed-line and mobile businesses both took a big hit due to the aforementioned factors above, with net profit after tax for the first-half to December 31st also plummeting a sharp 14.4% to AUS$1.79 billion ($US1.38 billion) from the previous period twelve months ago.

The repercussions of this for Telstra has been felt on the stock exchange with the bleak financial report sending shares prices tumbling down to 4.43% AUS$4.96 in mid-table trade in Sydney. Chris Weston, IG Markets chief strategist attempted to dissect Telstra’s failings and stated it as a ‘weak’ result for the Australian colossus.

Weston said, “It’s a weak result, you’ve got revenue and underlying profit all missing (market expectations) by a decent chunk. The implied volatility in a stock like Telstra is so low that this is as big a miss as you are going to get.”

Revenue for services such as fixed-line and mobile fell 4.7% and 8.7% respectively for this period. Overall sales revenue also decreased by 3.4% to AUS$12.79 billion. Telstra also disclosed an interim dividend of 15.5 AUS cents. Despite the poor nature of the financial results reported by the organization, Telstra chief executive Andrew Penn attempted to portray a positive light on reports – declaring the telco had performed well in a highly competitive market.

Penn said, “Data volumes have increased and intense competition on pricing across fixed, bundles, mobile, data and IP has had an impact. Those are in parallel with the acceleration of the rollout of (the National Broadband Network) which, over the longer term, will have a negative impact on EBITDA (earnings before interest, taxes, depreciation and amortization) of AUS$2-3 billion."

The NBN, or national broadband network, aims to connect most Australian homes to superfast Internet over the next few years, replacing Telstra's existing copper network.

Published in Telecom Operators

Apple posted its latest quarterly profits revealing an expected drop in iPhone sales which was expected. But the company made gains in services which offered hope for Apple as it moves away from its dependence on smartphones. The company said its profits fell 19 percent to $9 billion in the fiscal quarter ending September 24. Revenue dropped nine percent to $46.9 billion from $51.5 billion in 2015.

Market forecasts more-or-less predicted Apple’s results which showed that iPhone sales – the company’s largest revenue and profit driver – were down five percent from last year to 45.5 million units. Not a lot of attention was given to Apple’s latest iPhone 7 and 7 Plus smartphones in the report. The iPhones were released in September. The iPhone 7 was expected to boost Apple’s smartphone sales as it was expected customers were holding out to purchase the new device.

Saturation of smartphones in the market led to analysts expecting a decline in iPhone sales, which is what led Apple to pursue new product lines such as the Apple Watch and services such as mobile payments and music streaming. Apple’s CEO Tim Cook welcomed the quarterly results, calling them “our strong September quarter results,” adding that they “cap a very successful fiscal 2016 for Apple.”

In a statement, Cook said: “We're thrilled with the customer response to iPhone 7, iPhone 7 Plus and Apple Watch Series 2, as well as the incredible momentum of our services business, where revenue grew 24 percent to set another all-time record.”

Frank Gillett, a Forrester Research analyst, said the results show Apple is making progress in diversifying its mix of products and services as smartphone sales stagnate, AFP reported. "The rise of services shows they're more than a devicemaker," Gillett said. "It's indicative of the depth of engagement of their customers." The more consumers use Apple applications and services, the less likely they will switch to a rival," Gillett said.

An interesting part of Apple’s results shows that while its iPhone sales accounted for more than half of revenues, its services grew to $6.3 billion, proving that Apple is paving the way forward to expand its enterprise offerings. It’s seen as a smart move on Apple’s part, seeing as its other products, such as the iPad, saw a six percent drop in sales and a 14 percent decline in the number of Mac computers sols.

In the key "Greater China" market, Apple said revenues were down 30 percent from a year to $8.8 billion. But the company noted a 10 percent rise in revenue from Japan and cited gains in other global markets.

Published in Finance