Tag Archive | "operating-loss"

Alphabet’s “Other Bets” Cost It Almost $3.6B Last Year

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Box Drops 15% Despite Reporting Stronger Than Expected Q4 Revenue Growth

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Nintendo Second-Quarter Earnings Push Past Expectations

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Super Smash Bros

HTC Narrowly Avoids Another Quarterly Loss, Thanks To Beats Audio Stake Sale

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Back in October, in its Q3 results, HTC reported its first ever quarterly loss – of around $102 million. Now, in unaudited consolidated results for its Q4, released quietly Sunday as the tech press’ gaze is focused on Vegas for the annual Consumer Electronics Show, HTC revealed it has narrowly avoided a second consecutive quarter of loss.

HTC reported net profit after tax of NT$0.31 billion (circa $10.3 million) on total revenues of NT$42.89 billion ($1.4 billion). In its Q4 outlook, back in November, HTC had said it expected revenue for the quarter to be in the range of NT$40 billion to NT$45 billion.

However the small profit HTC squeaked in the quarter appears attached to the one-time windfall from selling its stake in Beats Audio, rather than selling enough phones to get back in the black. In September, HTC said it intended to sell its 24.84% stake in the audio brand for $265 million. Bloomberg expected the deal to close in the fourth quarter.

HTC’s unaudited results for its Q4 also report an operating loss of NT$1.56 billion (close to $52 million). Unaudited earnings per share after tax were NT$0.38 based on 823,541 thousand weighted average number of shares, which falls within HTC’s earlier expected EPS range of NT$0.1 to NT$1.7.

While it’s narrowly avoided another quarterly loss, there’s no denying HTC is running out of room for manoeuvre in the Samsung-dominated Android smartphone space. And that 2014 is going to be a critical year for the company.

Article courtesy of TechCrunch

Nokia Q2 2013 Misses On Sales Of $7.5B; Posts $0 EPS And 7.4M Lumias Sold

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More negative numbers for Nokia today, as the company reported its quarterly earnings for Q2, but it also noted sales of 7.4 million Window Phone-powered Lumia devices getting sold — the most in any quarter yet. Nokia said net sales for the company were $7.5 billion (€5.7 billion), with a non-IFRS earnings per share of $0.00 and a reported EPS of -$0.08. That’s a mixed result: Analysts were expecting a loss per share of $0.03, on revenues of $8.63 billion ($6.59 billion). The company’s operating loss of €115 million ($150 million) is significantly less than last year’s operating loss of €824 million ($1.1 billion).

As a point of comparison, the company last quarter reported 5.6 million Lumia devices sold, with sales of $7.6 billion and a non-IFRS loss per share of $0.03 (and a reported EPS of $0.09).

The net sales reported today are 24% down on the same quarter a year ago, and the fact that the company is reporting a cut in operating loss with better EPS points to the fact that improvements are coming not because of growth, but because the company continues to be in a cost-cutting mode (or, it is getting more efficient, depending on how you look at it). As a measure of that it is also continuing to cut jobs as well — with a round of 440 cuts being slipped into today’s earnings as part of that.

The company continues to pursue a two-level model where devices are concerned.

On one hand, it is looking to attract smartphone newbies who may have previously been still been using feature phones, or who are less inclined to pay premium prices. For these it is rolling out more lower-end smartphones and high-end feature phones for those spending less money in emerging and developed markets.

On the other, it’s trying to keep its reputation as a leader in the field by pushing boundaries on new features, such as the 41 megapixel camera that it unveiled in the Lumia 1020 last week.

In both regards, this quarter was not brilliant for either segment. In smart devices, Nokia’s sales by volume were down by 27% over a year ago, while its “mobile phones” segment (its term for the rest of the portfolio) was also down by 27% to 53.7 million units. In value terms, sales of smart devices were down 24% to $1.5 billion (€1.1 billion) compared to last year, while mobile devices were down 39% to $1.8 billion (€1.4 billion).

Throughout this, Nokia has yet to reach a tipping point in which either smartphone sales by value or volume are outweighing those of cheaper, lower end devices. And, the decline in smart devices overall shows that although Nokia’s newer Lumia brand and strategic direction continue to pick up steam, it still is not offsetting the left-behind Symbian platform.

In other words, while fighting off competition from dozens of handset makers making low-end devices, and despite innovations like the Lumia 1020, Nokia is still struggling to catapult itself to the top of the league of leaders in the new generation of devices, against the likes of Samsung making Android devices and Apple and its iPhone.

A hint in the earnings statement appears to point to Nokia believing that next quarter (Q3) will be a turnaround in that regard. “During the third quarter, we expect that our new Lumia products will drive a significant part of our Smart Devices revenue,” CEO Stephen Elop notes in a statement. The big question will be whether that Smart Devices revenue will be enough to keep losses at bay.

Location, NSN. In the rest of the earnings, sales in its location unit Here are down on a year ago as well. Sales came in at $305 million (€233 million), down 18% over last year, up 8% on the previous quarter. It remains loss-making, with a $116 million operating deficit, which is at least marginally better than the $120 million a year ago. But still points to how some of the big services stories that Nokia is pushing are not yet bearing black fruit.

But now that Nokia is full owner of Nokia Siemens Networks, it will be able to better consolidate some of those benefits on its balance sheet. While that division actually posted lower revenues compared to last year and last quarter — $3.6 billion, down 17% and 1% respectively — it is at the moment the only division of the company posting an operating profit, at a modest $10 million.

Article courtesy of TechCrunch

Amazon Led LivingSocial’s Last Round With A $56M Investment; Daily Deals Site Had A Net Loss Of $50M This Past Quarter

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Daily deals company LivingSocial continues to face challenges in the market. In the last quarter it posted sales of $135 million, up 23% on a year ago, but it also swung to a net loss of $50 million, from net income of $156 million in Q1 2012. The numbers were revealed in a 10-Q filing from one of its key investors, Amazon, in line with its Q1 earnings reported on Thursday.

The filing also shows that Amazon was the majority investor in the $110 million round earlier this year. Amazon put in $56 million of that sum.

“Additionally, in Q1 2013 we made a $56 million investment in LivingSocial that we have recorded as a cost method investment,” it notes.

LivingSocial’s operating loss, meanwhile, was down to about half the size of last year, at $44 million. The Washington Business Journal cites a source that notes that LivingSocial has reduced its operating cash burn to single-digit millions to continue that trend. The company has been making an effort to cut expenses; in November it laid of 10% of its staff, equivalent to about 400 people.

E-commerce giant Amazon has a 29% equity stake in the company, it noted in the SEC filing. It also writes in the 10-Q that the book value of its equity-method investment was $36 million at the end of March. The losses at LivingSocial had a $17 million negative impact on Amazon.

Overall, Amazon saw revenues of $16 billion, falling just short of analyst expectations of $16.2 billion, with a bleak outlook for the quarter ahead, with its aggressive, thin-margin strategy leading it to an operating loss of up to $340 million. Right now, its stock is trading nearly 7% down.

The market for daily deals sites is less than healthy right now. Rival Groupon in February also reported a worse-than-expected loss and then lost its founder and CEO Andrew Mason in the wake of the news, and now it’s working on a pivot to become more of a multi-purpose local commerce player.

LivingSocial, which has been around since 2007, has raised an eye-watering $918 million in the last six years — and what that much sunk into the company, you can see why existing investors are key to keep it from falling over. CEO Tim O’Shaughnessy noted in February that its most recent $110 million round of fundraising was indeed a “down round”, valuing the company at around $1.5 billion, lower than in its last fundraise. But it was not an emergency debt infusion, he maintained: at least some of the investors took equity in the company as part of the deal.

Article courtesy of TechCrunch

Groupon Reports $638.3M In Q4 Revenue, Shares Drop More Than 20 Percent Due To Worse-Than-Expected Loss

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Groupon has just put out its Q4 and full-year results. It has reported quarterly revenue of $638.8 million with an operating loss of $12.9 million and a loss per per share of 12 cents, falling short of analyst expectations on the EPS front — they had predicted $638.41 million in revenue and EPS of $0.03.

Those numbers show 30 percent revenue growth and a slightly smaller ($12.9 million versus $15 million) operating loss compared to the same period last year. (Those Q4 results needed to be restated about a month after reporting because Groupon had higher-than-expected refunds, due to selling more expensive products and having customers make more returns of those goods.)

As of 4:31pm Eastern, Groupon shares had fallen 22.44 percent (to $4.64) in after-hours trading.

The earnings release emphasizes gross billings, which grew 24 percent year-over-year to $1.52 billion.

“Record billings growth this quarter is a clear signal that customers love Groupons,” CEO Andrew Mason said in the release. “We will continue to invest in growth through 2013 as we see new opportunities to give our customers what they want.”

For the year as a whole, Groupon is reporting revenue of $2.33 billion (up 35 percent) and operating income of $98.7 million (compared to a loss of $233.4 million in 2011).

There were some bright spots for the company this past quarter due to holiday season shopping, particularly in the area of mobile commerce, one of the services that it wants to expand as part of its plan to expand beyond daily deals to provide more services to local businesses. It noted that Black Friday mobile transactions were up 140% year on year, with four times as many mobile purchases as on a normal Friday morning; mobile drove over 40% of Groupon’s overall transactions during that period as well as over half of Groupon Goods’ transactions. The earnings release says that that nearly 40 percent of transactions were completed on mobile in January, up 44 percent from the previous year.

Focusing on international, Groupon reported gross billings of $802 million (up 6.2 percent) and revenue of $263 million (down 15.9 percent) Groupon’s international business, which covers 47 countries outside of the U.S., with the U.K. the biggest market, is still based around the company’s legacy business of daily deals largely because Groupon’s growth has been inorganic and acquisition-based, and so each country has its own back-end system and has therefore been a challenge to integrate into what the U.S. is doing. It’s about a year behind but apparently integration of some of the mobile commerce services is on the agenda, so we may see services like Breadcrumb point of sale solution coming to international waters soon.

The results are coming in ahead of a Groupon board meeting tomorrow.

Article courtesy of TechCrunch

Sprint Q4 2012 Matches, Down $.44/Share On Revenues Of $9B, Reports 2.2M iPhones Sold

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Sprint Nextel, the third-ranking U.S. wireless carrier, has just announced earnings results for Q4 2012, reporting a net loss of $1.3 billion, and a negative EPS of $.44. That’s compared to a net loss of $1.3B and a diluted net loss of $.43 per share in the same quarter last year.

The company says that “$45 million or negative $.01 per share (pre-tax) was related to impacts from Hurricane Sandy.”

Analysts expected a negative EPS of $.37 on the quarter on revenues of $8.9 billion.

Wireless service revenues were $7 billion, while overall revenues were $9 billion compared to last year’s $8.72 billion.That comes out to an operating loss of $758 million.

In terms of device sales, Sprint sold 2.2 million iPhones in the period ending December 30, 38 percent of which went into the hands of new postpaid customers. Sprint has also sold more than 4 million 4G LTE smartphones as a part of its network upgrade.

That’s up from last quarter’s 1.5 million iPhones sold, which has been the flat figure from Sprint for the past three quarters.

This is likely due the holiday rush, which has contributed to net additions of 401,000 for the company’s post-paid subscriber base.

As a point of comparison, Verizon sold 6.2 million iPhones over roughly the same period, while AT&T sold 8.6 million. Clearly, even a slight jump for Sprint doesn’t quite match that of its competitors.

Sprint’s rollout of its 4G LTE network began in July of last year and has since grown to cover 58 different markets. This network upgrade is crucial to Sprint’s future success as AT&T and Verizon’s high-speed networks are already developed and operational on a nationwide scale.

Though the company is still struggling, an acquisition by Japan’s Softbank Corp should help with a boost for Sprint. The deal closed for $20.1 billion in exchange for 70 percent of the fully-diluted shares of Sprint stock.

Thanks to the added security of this deal, Sprint recently made a bid to buy out the remaining shares of Clearwire that it doesn’t already own for $2.97/share. However, Dish seems to have made a higher bid of $3.30/share, which could be detrimental to Sprint which licenses Clearwire’s network.

Article courtesy of TechCrunch

Every Little Bit Helps: To Shore Up Some Cash, Nokia Sells And Leases Back Its Espoo, Finland, HQ For €170 Million To Finland’s Exilion

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You know times are tough when you have to sell the HQ and rent it back to raise a little capital. Well that’s exactly what the once mighty mobile maker, Nokia, is doing. The company has just announced that it intends to sell its Espoo, Finland, headquarters to Finland-based Exilion, and rent it back on a long term lease. The selling price is €170 million.

Nokia said it expects the sale to be completed by the end of the year.

“We had a comprehensive sales process with both Finnish and foreign investors and we are very pleased with this outcome. As we have said before, owning real estate is not part of Nokia’s core business and when good opportunities arise we are willing to exit these types of non-core assets. We are naturally continuing to operate in our head office building on a long-term basis,” said Timo Ihamuotila, CFO, Nokia in a statement.

Nokia said it has operated the 48,000 m2 building (pictured below), which was designed by architect Pekka Helin, since 1997. The building is located in Keilaniemi, Espoo, Finland.

The HQ sale is not unexpected, as Nokia has previously confirmed it was looking at an HQ sale to raise money – albeit a price of €300 million was bandied around at that time. In its Q2 results the company said it was “re-evaluating all non-core operations” — including real estate. In October, a Nokia spokesperson told TechCrunch: “As with most companies whose core business is not in owning real estate, it makes common business sense not to tie assets in real estate property but rather invest and focus in its core operations.”

Nokia is slimming its operations because its switch to Microsoft’s Windows Phone platform for high end smartphones, and away from its legacy Symbian platform, has hammered revenues — with the mobile maker posting a string of consecutive quarterly losses this year. Nokia posted an operating loss of €576 million in Q3 and almost doubling its Q1 operating loss in Q2. In its Q3 results it said it expects Q4 to be “challenging” — and noted that it had only sold 2.9 million Windows Phone based smartphones, down from four million in Q2.

Nokia’s cash reserves are also shrinking: net cash fell to €3.6 billion by the end of Q3, down from €4.2 billion in June.

Nokia has shuttered a number of factories, operations centres, assets and business units – and slashed its head count – since the switch to Windows Phone.  In July, it confirmed the closure of its last Finnish handset factory in Salo, Finland. It has also shuttered R&D centers in Germany and Canada, as it seeks to reduce costs — hoping to save nearly $2 billion by the year’s end.

Article courtesy of TechCrunch

Nintendo Pulls Out Of Financial Dive, Legacy Console Sales Slow

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Nintendo has stemmed operating loss slightly in the April-September quarter, the total falling from $718 million to $366 million. Console sales fell about 60 percent with DS sales of 970,000 and Wii sales hitting 1.32 million.

The 3DS rose nearly 65%, however, with sales of 5 million units, including 2.1 million 3DS XLs.

Nintendo noted that a number of titles, including New Super Mario Bros. 2 and Mario Kart 7, buoyed 3DS revenue considerably. Nintendo and its partners sold 19.03 million games for the 3DS, which suggests a great deal of interest and support in the platform.

You can read the complete earnings report here. The stock closed at 16.14 today.

Article courtesy of TechCrunch

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