Technology companies have begun releasing their earnings reports for the latest quarter. The reports come as consumers shift their spending toward tablets. Here is a summary of recent earnings and reports for selected technology companies and what they reveal about the state of spending and the overall economy.
April 5: Estimates from Samsung Electronics Co show that operating profit for the first quarter grew 53 per cent from a year earlier to 8.7 trillion won (Dh28.2 billion), outpacing expectations for what’s normally a slow time for consumer electronics sales. Revenue grew 15 per cent to 52 trillion won. Analysts say Samsung benefited from smartphone sales and shortages in memory chips for personal computers.
April 10: Research firms IDC and Gartner release reports showing unprecedented declines in sales of desktop and laptop machines during the first three months of the year. IDC says first-quarter shipments of PCs fell 14 per cent worldwide from a year earlier. That’s the deepest quarterly drop since the firm started tracking the industry in 1994. Another research firm, Gartner Inc, pegged the first-quarter decline at 11 per cent. IDC Vice President Bob O’Donnell says Microsoft’s release on Windows 8 in October “not only didn’t provide a positive boost to the PC market, but appears to have slowed the market.
Tuesday: Yahoo Inc says its first-quarter earnings surged 36 per cent, but investors appear disappointed that revenue shrank by seven per cent. The weak spot was in one of Yahoo’s former strengths — display advertising. After subtracting the commissions that Yahoo pays its partners, the company’s display advertising revenue fell by 11 per cent from last year to $402 million. That development suggests that Yahoo is losing more ground in a key area of Internet advertising to Google Inc and Facebook Inc.
Wednesday: eBay Inc says its earnings and revenue grew in the first quarter thanks to growth in its PayPal business and its e-commerce sites. But revenue was slightly below Wall Street’s expectations.
Thursday: Google Inc issues results that provide further proof that the internet search leader is figuring out how to make more money as web surfers migrate from personal computers to mobile devices. The first-quarter numbers show that a recent decline in Google’s average ad prices is easing. That’s an indication that marketers are starting to pay more for the ads that Google distributes to smartphones and tablet computers.
Microsoft Corp says revenue and net income surged in the latest quarter, but much the gains were due to the recognition of sales that occurred before the launch of the latest versions of Windows and Office. Microsoft’s Windows division reports a 23 per cent increase in revenue to $5.7 billion, but adjusting for the deferred revenue, was flat.
IBM Corp says first-quarter net income fell one per cent due to delays in closing several of the technology company’s large software and mainframe computer deals.
Verizon Communications Inc says profit rose 16 per cent in the latest quarter as wireless revenue kept rising at a rate that’s the envy of the industry. Service revenues at Verizon Wireless, the country’s largest mobile phone carrier, rose 8.6 per cent to $16.7 billion, accounting for more than half of overall revenue. At its closest rival AT&T Inc, wireless service revenue has been rising just over four per cent per year.