Displaying items by tag: revenue
IBM experiences dip in revenues for third consecutive quarter
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.
Zoom profits double as revenue quadruples
Zoom shares soared after the video-meeting service reported that quarterly revenue rocketed as its ranks of users more than quadrupled.
Revenues leaped 355% to $663.5m for the three months ending 31 July, beating analysts' expectations of $500.5m.
Profits soared to $186m, while customer growth rose 458%, compared with the same period in 2019.
Video conferencing apps remain crucial due to the increase in remote working.
Zoom's shares hit a record high, closing at $325.10, as the firm raised its annual revenue forecast by more than 30% to the range of $2.37bn-$2.39bn, from its previous projection of $1.78bn-$1.80bn.
Key to Zoom's success was its ability to add paying customers - high-budget corporate clients - as opposed to those who use its services for free.
"Organizations are shifting from addressing their immediate business continuity needs to supporting a future of working anywhere, learning anywhere, and connecting anywhere on Zoom's video-first platform," founder and chief executive Eric Yuan said in an earnings release.
Zoom shares were up more than 22 percent in after-market trades that followed release of the earnings, which beat market expectations.
The company reported that it ended the quarter with approximately 370,000 customers that had more than 10 employees, more than four times as many than it had in the same period a year earlier.
The increase in customers built on a surge in the previous fiscal quarter, and appeared to offset investor concerns that Zoom's popularity would decline when restrictions on movements ease and people can get back to seeing one another in person.
The earnings come with Zoom still under pressure to deal with security and privacy. It has taken heat over uninvited cyber guests disrupting online meetings with a tactic called "zoombombing."
Zoom was originally built for businesses with dedicated IT teams to handle implementing security features, but first-time users flocked to the service to work or socialize from home due to the pandemic.
Yuan said on a previous earnings video call with analysts that Zoom "learned a hard lesson" that it should have provided more tech support.
"We should have played the role of IT for first-time users. We learned a hard lesson; this was a mistake I made." As a result, the company has poured resources into privacy and security.
Huawei experiences 13.1% revenue increase in H1 2020
Huawei has announced its financial results for the first half of 2020 which showed a 13.1% increase year-on-year and a net profit margin of 9.2%.
The tech giant generated CNY454 billion in revenue throughout the first half of the year. As for their carrier, consumer and enterprise business, they achieved CNY159.6 billion, CNY255.8 billion and CNY36.3 billion.
As countries across the world have been dealing with the COVID-19 pandemic as best they can, ICT has become absolutely essential to combatting the virus and containing its spread. Not only that, but it has also become an engine for economic recovery.
Huawei has been at the forefront of innovation, namely during this period which has been characterized by economic uncertainty. They have been key enablers in helping many industries maintain stable network operations, support efforts to contain the spread of the virus, accelerate digital transformation and reopen economies.
Iridium announces first quarter results; lowers 2020 outlook
Iridium Communications reported financial results for the first quarter of 2020 and updated its full-year 2020 outlook. Net loss was $31.7 million, or $0.24 per diluted share, for the first quarter of 2020, as compared to net loss of $18.0 million, or $0.18 per diluted share, for the first quarter of 2019.
This increase in net loss was primarily the result of debt extinguishment costs associated with Iridium’s refinancing of its senior unsecured notes. Operational EBITDA for the first quarter was $92.1 million, as compared to $78.0 million for the prior-year period, representing a year-over-year increase of 18% and an operational EBITDA margin of 63%.
Iridium reported first-quarter total revenue of $145.3 million, which consisted of $116.0 million of service revenue and $29.3 million of revenue related to equipment sales and engineering and support projects. Total revenue increased 9% from the comparable period of 2019, while service revenue grew 8% from the year-ago period. Service revenue, which represents primarily recurring revenue from Iridium’s growing subscriber base, was 80% of total revenue for the first quarter of 2020.
The Company ended the quarter with 1,332,000 total billable subscribers, which compares to 1,151,000 for the year-ago period and is up from 1,300,000 for the quarter ended December 31, 2019. Total billable subscribers grew 16% year-over-year, driven by growth in commercial and government IoT customers.
“In the first quarter, Iridium delivered solid growth in total revenue and billable subscribers, driven by strong gains in service revenue, engineering and support services, and equipment sales. New revenue from Iridium Certus® broadband, along with increases in contractual revenue from the U.S. government and Aireon also aided our results,” said Matt Desch, CEO, Iridium. Desch added, “Iridium is pleased to have completed all planned refinancing activities in recent months, and we remain confident in our ability to generate significant free cash flow in 2020 and beyond. Accordingly, we continue to be committed to undertaking shareholder-friendly activities in due course.”
Commenting on the impact of COVID-19 to the business, Desch said, “In March we began to see a reduction in the pace of subscriber additions, and heard from some of our many partners about varying levels of business impact depending on their industry. Into April, these trends accelerated. While we continue to forecast overall growth in service revenue and Operational EBITDA for 2020, we are updating our full-year outlook to account for these unfavorable impacts.”
Desch continued, “Iridium’s satellite services are used for mission-critical applications across the globe, and our revenue base has, historically, been more resilient than many businesses to exogenous shocks and economic cycles, though the current economic shutdown is unprecedented. The timing of the shutdown coincides with Iridium’s peak season and will impact us accordingly. Still, we remain confident in Iridium’s ongoing financial position and our capacity to generate significant free cash flow.”
Commercial service remained the largest part of Iridium’s business, representing 63% of the Company’s total revenue during the first quarter. The Company’s commercial customer base is diverse and includes markets such as maritime, aviation, oil and gas, mining, recreation, forestry, construction, transportation and emergency services. These customers rely on Iridium’s products and services as critical to their daily operations and integral to their communications and business infrastructure.
Commercial service revenue was $91.0 million, up 7% from last year’s comparable period due to an increase in revenue primarily from hosted payload and other data services, broadband and IoT.
Commercial voice and data subscribers were up 1% from the year-ago period to 351,000 customers. Commercial voice and data average revenue per user (“ARPU”) was $40 during the first quarter, unchanged from last year’s comparable period. Commercial IoT data subscribers grew 22% from the year-ago period to 830,000 customers, driven by continued strength in consumer personal communications and tracking devices. Commercial IoT data ARPU was $9.71 in the first quarter, compared to $11.32 in last year’s comparable period.
Commercial broadband revenue was $8.7 million, up from $6.8 million in the year-ago period. This rise was primarily attributable to the introduction of Iridium Certus broadband service. Commercial broadband average revenue per user (“ARPU”) was $267 during the first quarter, compared to $233 in last year’s comparable period.
Iridium’s commercial business ended the quarter with 1,192,000 billable subscribers, which compares to 1,036,000 for the year-ago period and is up from 1,165,000 for the quarter ended December 31, 2019. IoT data subscribers represented 70% of billable commercial subscribers at the end of the quarter, an increase from 65% at the end of the prior-year period.
Hosted payload and other data service revenue was $16.3 million in the first quarter compared to $13.9 million in the prior-year period, which was primarily due to increased Aireon data service fees related to a contractual step-up.
Iridium’s voice and data solutions improve situational awareness for military personnel and track critical assets in tough environments around the globe, providing a unique value proposition that is not easily duplicated.
Under the Enhanced Mobile Satellite Services contract (the “EMSS Contract”), a seven-year, $738.5 million fixed-price airtime contract with the U.S. Air Force Space Command signed in September 2019, Iridium provides specified satellite airtime services, including unlimited global standard and secure voice, paging, fax, Short Burst Data®, Iridium Burst®, RUDICS and Distributed Tactical Communications System services for an unlimited number of Department of Defense and other federal government subscribers. Iridium also provides maintenance and support work for the U.S. government’s dedicated Iridium gateway under two other contracts with the U.S. Air Force Space Command. Iridium Certus airtime services are not included under these contracts and may be procured separately for an additional fee.
Government service revenue was $25.0 million and reflected increased revenue from the Company’s EMSS Contract.
Iridium’s government business ended the quarter with 140,000 subscribers, which compares to 115,000 for the year-ago period and is up from 135,000 for the quarter ended December 31, 2019. Government voice and data subscribers rose 11% from the year-ago period to 59,000 as of March 31, 2020. IoT data subscribers increased 31% year-over-year and represented 58% of government subscribers, an increase from 54% at the end of the prior-year period.
Equipment revenue was $22.3 million during the first quarter, up 6% from the prior-year period.
Due to the combined effects of the current global shutdown, deterioration in the oil and gas market, and strength of the U.S. dollar, the Company now expects full-year equipment sales will be down from 2019 levels.
Engineering and support revenue was $7.0 million during the first quarter, compared to $5.7 million in the prior year’s quarter, primarily due to an increase in the volume of contracted work.
Capital expenditures were $9.5 million for the first quarter, which includes $1.2 million of capitalized interest. The Company ended the first quarter with gross debt of $1.65 billion and a cash and cash equivalents balance of $67.3 million, for a net debt balance of $1.58 billion.
Two noteworthy transactions have impacted the structure of Iridium’s debt financing over the last two quarters. In November 2019, the Company entered into a seven-year, $1.45 billion secured Term Loan. The proceeds of the Term Loan, along with the cash in the Company’s debt service reserve account and cash on hand, were used to prepay all of the indebtedness outstanding under its BPIAE Facility and premiums for early prepayment, net of amounts refunded, of $48.9 million. On February 7, 2020, the Company closed on an additional $200.0 million under its Term Loan. On February 13, 2020, the Company used the proceeds of this transaction, together with cash on hand, to prepay all of the $360.0 million in indebtedness outstanding under the Company’s senior unsecured notes, premiums for early prepayment of $23.5 million, and accrued interest.
Given the current global shutdown and macroeconomic uncertainties, the Company updated its full-year 2020 outlook and currently anticipates:
- Growth in total service revenue for full-year 2020. Total service revenue for 2019 was $447.2 million.
- Growth in OEBITDA for full-year 2020. OEBITDA for 2019 was $331.7 million.
- Negligible cash taxes in 2020. Cash taxes are expected to be negligible through approximately 2023.
- Net leverage of no more than 4.4 times OEBITDA at the end of 2020. Net leverage was 4.8 times OEBITDA at December 31, 2019.
Twitter warns of Covid-19 impact on Q1 results
Twitter has announced it expects operating loss in the first-quarter, and quarterly revenue to be down on a year-over-year basis, as a result of the impact of the coronavirus pandemic.
"Twitter had a strong start to the year before the effects of COVID-19 began spreading more broadly...... it has impacted Twitter's advertising revenue globally more significantly in the last few weeks," said Ned Segal, Twitter's Chief Financial Officer.
Despite this, the crisis has significantly expanded its average daily user base — with a net gain of 12 million so far in the current period. The COVID-19 outbreak have boosted Twitter’s overall daily active users (DAU): According to the company, year to date average total monetizable DAU are approximately 164 million, up 23% from 134 million in Q1 2019 and an increase of 8% from 152 million in Q4 2019.
In the current quarter, “We’re seeing a meaningful increase in people using Twitter, and our teams are demonstrating incredible resilience adapting to this unprecedented environment,” Twitter CEO Jack Dorsey said in a statement. “We’ll continue to navigate this environment focusing on supporting our employees, customers, and partners, while strengthening our service for everyone around the world and adjusting to a new operating and economic environment.”
While announcing the fourth-quarter results, Twitter had expected operating income to be between break even and $30 million, and total revenue of $825 million - $885 million for the first-quarter.
The company said it withdrew its prior operating income and revenue guidance for the first quarter of 2020, due to the profound changes on the global operating and economic environment and the effect on advertiser demand.
Twitter expects to release financial results for the first quarter on April 30, 2020.
Apple exceeds expectations with record quarterly revenue
Apple has delivered record results for the final three months of last year, delivering gains in sales of iPhones even as the company transitions to digital services and wearables.
Net profit hit an all-time high of $22 billion on record quarterly revenue of $91.8 billion, the California tech giant said of the results which were far stronger than most analyst estimates.
Previously, Apple told investors that it expected revenue of “between $85.5 billion and $89.5 billion” in the quarter, along with “gross margin between 37.5 percent and 38.5 percent.”
"We are thrilled to report Apple's highest quarterly revenue ever, fueled by strong demand for our iPhone 11 and iPhone 11 Pro models, and all-time records for services and wearables," said Apple chief executive Tim Cook.
The results come with Apple seeking to shift its revenue mix amid a slumping smartphone market and growing competition in the segment, and relying more on services such as music, streaming television and other digital content.
Shares in Apple jumped two percent in after-market trades that followed release of the fiscal first-quarter earnings, extending a remarkable streak for the company. Shares have doubled from a year ago – lifting its valuation to more than $1.3 trillion.
The company has expanded its services with a streaming television offering, digital payments and wearable tech such as its AirPods and updated Apple Watch.
Analyst Yoram Wurmser of the research firm eMarketer welcomed "a strong quarter for Apple, primarily driven by strong sales of the iPhone 11 lineup."
Apple bought back $20 billion in shares during the quarter and paid some $3.5 billion in dividends as part of a stated mission to be "net cash neutral" some time in the future, Maestri said.
Apple has stopped reporting unit sales for the iPhone, which has been the main cash-generator for the company in recent years, but sales revenue for its smartphone sales was up nearly eight percent in the quarter at $55.9 billion.
Services revenue rose 17 percent from a year ago to $12.7 billion, driven by the launch of its Apple TV+ service and its new credit card.
The Apple TV+ on-demand streaming service launched in more than 100 countries at $4.99 per month, at a price lower than those offered by rivals such as Netflix.
For the category of wearables and home accessories -- including its HomePod speaker, Apple Watch and other gadgets -- revenue increased some 37 percent to $10 billion.
Apple forecast revenue between $63.0 billion and $67.0 billion in the current quarter.
Intel reports fourth quarter and 2019 financial results
Intel Corporation today reported fourth-quarter and full-year 2019 financial results. Intel exceeded expectations with a record revenue of $20.2 billion, up 8 percent year-over-year (YoY). Full-year revenue set an all-time record of $72.0 billion, up 2 percent YoY on data-centric growth.
Intel also delivered outstanding fourth-quarter earnings per share (EPS) of $1.58.A record $33.1 billion cash was generated from operations and $16.9 billion of free cash flow, and returned approximately $19.2 billion to shareholders.
The company’s board of directors approved a five percent cash dividend increase to $1.32 per share on an annual basis. The board declared a quarterly dividend of $0.33 per share on the company’s common stock, which will be payable on March 1 to shareholders of record on February 7.
“In 2019, we gained share in an expanded addressable market that demands more performance to process, move and store data,” said Bob Swan, Intel CEO.
“One year into our long-term financial plan, we have outperformed our revenue and EPS expectations. Looking ahead, we are investing to win the technology inflections of the future, play a bigger role in the success of our customers and increase shareholder returns."
Revenues of the largest division of Intel, the Client Computing Group, producing chips for PCs, laptops and tablets, grew by 2% (compared with the fourth quarter of 2018) to $ 10.01 billion, exceeding analytical forecasts of $ 9.74 billion.
Most notably, revenue from the Data Center Group segment, which manufactures chips for computer servers grew 19% to $ 7.21 billion, which also exceeded analysts’ expectations of $ 6.40 billion. The non-volatile memory division selling storage and memory products, received income of $ 1.22 billion, which is lower than the forecast of $ 1.28 billion.
The company expects a strong first quarter this year. Intel’s forecast for the whole of 2020 is also higher than analysts’ expectations, with 2020 revenue of approximately $73.5 billion and first-quarter revenue of approximately $19.0 billion.
5G expected to generate $17 trillion in economic growth by 2035
A report released by ABI Research urges telecom operators to be more aggressive with their 5G deployment in cities to leverage the new potential economic value.
5G technology is expected to generate trillions of dollars through both direct and indirect contributions.
The study, titled ‘5G Urban Deployment: Debunking the CapEx myth and unlocking new growth’, found that 5G will generate growth in three areas between now and 2028.
They found that $2.4 trillion will be gained in direct contributions which will most likely be due to end-user subscriptions for connectivity services, $866 billion in indirect contributions such as through increases in the supply chain from infrastructure, advertising and devices, and finally, $3.2 trillion in productivity gains which will be generated from greater workforce efficiency due to increased connectivity within cities.
Vertical enterprise services are expected to mature by 2035 and ABI Research forecasts that 5G will generate $17 trillion in economic growth by then. However, at first these services will be evident in bigger cities but will then extend to non-urban areas.
“5G in urban areas can create a new wave of enterprise vertical use cases that will redefine consumer lifestyles and enterprise operations in cities. The dense population of urban areas will allow mobile operators to better monetize new 5G services without massive investment or a long ROI cycle,” the report read.
ABI Research also found that the first 5G-related use cases will be driven by enhanced Mobile Broadband (eMBB) but other advanced use-case-enabling 5G features like Ultra-Reliable Low-Latency Communications (URLLC) will begin to appear by 2020.
“We have reached a critical point today where our global economy is heavily reliant on our ability to deliver new technological services,” said Dimitris Mavrakis from ABI Research. “5G has the potential to completely change our everyday lives, but only if mobile service providers can roll out 5G in a way that makes economical and logical sense- that, to start with mobile broadband connectivity deployments in urban areas to create the right use cases that will justify investments in CapEx and OpEx.”
InterDigital’s (the company which commissioned the study) Chief Technology Officer, Henry Tirri, said “We expect 5G deployment to begin to place huge pressures on mobile operators over the next couple of years as they look to compete to capitalize on its revenue potential. Many are trying to understand how they will monetize this next generation of wireless technology, and most importantly, how they’ll deliver ROI from it. But while there may still be several questions and doubts surrounding 5G monetization, these findings clearly demonstrate the growth opportunities that 5G is set to bring about. While CapEx and OpEx investments will be high, it is evident that 5G technology will radically change our ability to deliver new and innovative consumer and enterprise services, and help dictate the trajectory of our future global economy.”
Uber’s growth slows as it prepares for IPO
US ride-hailing colossus Uber disclosed its financial earnings for the final quarter of 2018 which showed its revenue growth has slowed ahead of its much anticipated stock market debut.
The financial figures released by Uber indicated that for the final three months of the year its loss amounted to $865 million, compared with $1.1 billion in the same period a year earlier.
The San Francisco-based firm reported revenue of $3 billion, which represented a 25 percent increase from a year earlier. Uber remains a private company, but routinely discloses some earnings information.
CEO Dara Khosrowshahi has managed to guide Uber through choppy waters since assuming the CEO role from Travis Kalanick.
He is also being tasked with the responsibility of steering the high-value startup to a stock market debut this year, and has promised greater transparency as he seeks to restore confidence in the global ridesharing leader that has been hit by a wave of misconduct scandals and has become embroiled in a series of legal battles regarding its services, particularly in Europe.
Revenue for the full year rose 43 percent to $11.3 billion, with Uber's annual loss shrinking 15 percent to $1.8 billion, according to an official statement from the startup.
Uber operates its’ rideshare business in dozens of countries and has expanded to new areas including food delivery, electric scooters and bikes. The company is recognized as the largest of the venture-backed startups with a presumed valuation of some $70 billion.
Uber CFO Nelson Chai expressed his satisfaction with Uber’s financial results and said, “Last year was our strongest yet, and Q4 set another record for engagement on our platform. Our ridesharing business maintained category leadership in all regions we serve, Uber Freight gained exciting traction in the US, JUMP e-bikes and e-scooters are on the road in over a dozen cities."
Based on gross bookings, Uber Eats has apparently become the largest online food delivery business outside of China.
2018 was rough for smartphones market and 2019 is set to be worse
Global smartphone sales saw their worst contraction ever in 2018, and the outlook for 2019 isn't much better, new surveys show. Worldwide handset volumes declined 4.1% in 2018 to a total of 1.4 billion units shipped for the full year, according to research firm IDC, which sees a potential for further declines this year.
“Globally the smartphone market is a mess right now,” said IDC analyst Ryan Reith. “Outside of a handful of high-growth markets like India, Indonesia, (South) Korea and Vietnam, we did not see a lot of positive activity in 2018.”
Reith said the market has been hit by consumers waiting longer to replace their phones, frustration around the high cost of premium devices, and political and economic uncertainty. The Chinese market, which accounts for roughly 30 percent of smartphone sales, was especially hard hit with a 10% drop, according to IDC's survey.
IDC said the top five smartphone makers have become stronger and now account for 69% of worldwide sales, up from 63% a year ago. Samsung remained the number one handset maker with a 20.8% share despite an eight percent sales slump for the year. Apple managed to recapture the number two position with a 14.9% market share, moving ahead of Huawei at 14.7%, the survey found.
IDC said fourth-quarter smartphone sales fell 4.9% - the fifth consecutive quarter of decline. “The challenging holiday quarter closes out the worst year ever for smartphone shipments,” IDC said in its report.
A separate report by Counterpoint Research showed similar findings, estimating a seven percent drop in the fourth quarter and four percent drop for the full year. “The collective smartphone shipment growth of emerging markets such as India, Indonesia, Vietnam, Russia and others was not enough to offset the decline in China,” said Counterpoint associate director Tarun Pathak.