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Tuesday, October 29, 2013 11:16:00 PM
From Briefing.com: 4:20 pm : The S&P 500 registered its fourth consecutive advance, climbing 0.6% to extend its October gain to 5.4%. The Dow Jones Industrial Average (+0.7%) outperformed the benchmark index while the Nasdaq (+0.3%) lagged after starting the session in-line with the S&P.
The tech-heavy Nasdaq posted a modest advance of 0.3% after the exchange experienced an intraday data dissemination issue that prevented index quotes from being sent out for nearly an hour. However, the issue was isolated to the index while individual components traded normally.
One of the components that contributed to the Nasdaq's underperformance was Apple (AAPL 516.68, -13.20). The largest tech stock lost 2.5% after its below-consensus gross margin guidance overshadowed its earnings beat on above-consensus revenue.
Despite Apple's relative weakness, the technology sector (+0.5%) ended in-line with the broader market, bolstered in part by the 2.7% gain in the shares of IBM (IBM 182.12, +4.77). Big Blue rallied after the company's Board of Directors authorized an additional $15 billion for its share buyback program. Chipmakers also contributed to the sector's strength as the PHLX Semiconductor Index advanced 1.5%.
Outside of technology, consumer discretionary (+0.6%) and energy (+0.7%) were the only other outperformers among cyclical sectors while financials, industrials, and materials ended with gains of 0.3% apiece.
The discretionary sector received support from homebuilders as all major builders posted gains while the iShares Dow Jones US Home Construction ETF (ITB 23.43, +0.32) rose 1.4%. Meanwhile, the energy sector was underpinned by BP (BP 45.90, +2.18) and Valero (VLO 40.21, +0.76) after both reported solid quarterly results.
Among countercyclical groups, utilities (+0.1%) lagged while consumer staples (+0.9%), health care (+0.7%), and telecom services (+1.5%) outperformed. Among earnings of note, Pfizer (PFE 31.25, +0.51) settled higher by 1.7% after beating bottom-line estimates by two cents on in-line revenue.
Treasuries ended on their highs as the 10-yr yield slipped two basis points to 2.50%.
With just two sessions left in October, the S&P is on track to post a solid monthly advance of 5.3%. While the month-to-date gain is impressive, the S&P 500's performance over the past 15 sessions has been even more eye-popping. Since October 8, the index has gained more than 7.0%. Investors will receive the latest policy statement from the Federal Open Market Committee tomorrow, but the markets are expecting the FOMC decision to be a non-event.
Trading volume was on the light side as just over 680 million shares changed hands on the floor of the New York Stock Exchange. Today's economic data was plentiful, but did little to suggest the Federal Reserve will be eager to curtail the pace of its asset purchases in the near term.
The Conference Board's Consumer Confidence Index plummeted in October, falling from an upwardly revised 80.2 (from 79.7) to 71.2 (73.1 Briefing.com consensus). The entire decline in confidence can be attributed to the reaction to the government shutdown and near-default by the U.S. Treasury.
Typically, confidence levels are influenced by equity trends, oil prices, labor conditions, and media reports. Other than the negative media attention on the shutdown, all of the typical components moved in a positive direction in October. If these trends continue in November, the Consumer Confidence Index should slowly return to at least September levels.
Separately, September retail sales declined 0.1% to follow an August increase of 0.2% (-0.1% Briefing.com consensus). The headline decline in retail sales masked an otherwise strong report, especially considering that private payroll growth was much weaker than expected.
The entire decline in sales was the result of a 2.2% drop in motor vehicle demand. Motor vehicle manufacturers already showed that August sales were boosted by calendar effects stemming from an extra weekend and the Labor Day holiday. With those biases removed, sales were set to decline substantially in September, which translated into the 2.2% drop in motor vehicle sales.
Total business inventories increased 0.3% in August after increasing 0.4% in July (+0.2% Briefing.com consensus).
Also of note, September producer prices fell 0.1% after increasing 0.3% in August (+0.2% Briefing.com consensus). That was the first monthly decline since prices fell 0.7% in April.
Food prices unexpectedly declined 1.0% in September after increasing 0.5% in August. A 17.9% drop in fresh and dry vegetables prices contributed to most of the September decline. Those prices increased 26.9% in August.
Tomorrow, the weekly MBA Mortgage Index will be reported at 7:00 ET, October ADP Employment Change will be released at 8:15 ET, and September CPI will cross the wires at 8:30 ET. In addition, the FOMC will release its latest policy statement at 14:15 ET. On the earnings front, General Motors (GM 36.06, +0.26), Comcast (CMCSA 47.71, -0.52), and Exelon (EXC 28.05, -0.02) will report their results ahead of the opening bell.DJ30 +111.42 NASDAQ +12.21 SP500 +9.84 NASDAQ Adv/Vol/Dec 1505/1.81 bln/1040 NYSE Adv/Vol/Dec 1856/682.6 mln/1136
3:30 pm :
Dec gold chopped around in negative territory today as a stronger dollar index pressured prices. The yellow metal brushed a session high of $1352.90 per ounce in late morning pit trade but was unable to sustain the momentum. It settled 0.5% lower at $1345.30 per ounce, slightly above its session low of $1342.40 per ounce
Dec silver spent most of the session trading near the unchanged line after lifting from a session low of$22.38 per ounce set in early morning pit trade. It eventually settled with a 0.1% loss at $22.49 per ounce
Dec crude oil fell for the first time in four sessions as the dollar index advanced. The energy component traded as low as $97.82 per barrel and settled with a 0.4% loss at $98.26 per barrel
Dec natural gas retreated back into negative territory after touching a session high of $3.67 per MMBtu in early morning pit trade. It settled 0.8% lower at $3.63 per MMBtu.
4:51PM Nanometrics beats by $0.02, beats on revs; guides Q4 EPS in-line, revs in-line (NANO) 16.38 -0.49 : Reports Q3 (Sep) loss of $0.06 per share, excluding non-recurring items, $0.02 better than the Capital IQ Consensus Estimate of ($0.08); revenues fell 11.1% year/year to $39.0 mln vs the $38.6 mln consensus. Co issues in-line guidance for Q4, sees EPS of $(0.08)-0.03, excluding non-recurring items, vs. $0.00 Capital IQ Consensus Estimate; sees Q4 revs of $42-47 mln vs. $44.2 mln Capital IQ Consensus Estimate.
4:47PM Rubicon Tech misses by $0.04, beats on revs; guides Q4 EPS below consensus (RBCN) 9.07 -0.10 : Reports Q3 (Sep) loss of $0.26 per share, $0.04 worse than the Capital IQ Consensus Estimate of ($0.22); revenues fell 44.2% year/year to $11.1 mln vs the $10.78 mln consensus. Co issues downside guidance for Q4, sees EPS of ($0.24)-($0.22) vs. ($0.11) Capital IQ Consensus Estimate.
Commenting on the outlook for the fourth quarter of 2013, Mr. Weissman said, "We believe sapphire demand will continue to strengthen and we expect pricing for two and four-inch cores to be higher in the fourth quarter and have added some additional core fabrication capacity. With lower than expected wafer orders from the SoS market, our wafer revenue will be lower in the fourth quarter, offsetting most of the sequential price and volume increases for two and four-inch core. Therefore, we are expecting fourth quarter revenue to be similar to the third quarter (Cap IQ Q4 revenue consensus is $13.7 mln). We are very optimistic about wafer demand next year but it could take another couple of quarters to see a meaningful improvement in wafer orders. Idle plant costs will remain high in the fourth quarter but we will begin to see some reduction in idle plant costs as we have now started the process of re-starting idle crystal growth furnaces.
"With the rising demand for sapphire, pricing has been steadily rising and current market pricing, which will be reflected in our fourth quarter numbers, is now back to approximately break-even for our two and four inch core products. Given the momentum of the LED general lighting market and introduction of new applications for sapphire, we expect pricing to continue to strengthen going into next year." The Company announced the launch of its four and six-inch patterned wafer product ("PSS") and reported that seven tier-one LED chip manufacturers have already requested samples. "We are very pleased with the customer response thus far and believe that PSS will be a strong growth driver for our wafer business," Mr. Parvez said. "While we are a few quarters away from volume production orders, we believe that PSS wafer sales should generate at least $15 million in revenue for us in 2014."
The Company also reported that orders from their major SoS customer are very limited due to excess wafer inventory at the customer. That customer is also introducing new RF chips that will be produced on SoI rather than SoS starting early next year. Therefore future sapphire purchases from that customer will likely be lower than they have been historically.
4:20PM FEI reports EPS in-line, misses on revs; guides Q4 EPS in-line, revs in-line (FEIC) 89.14 : Reports Q3 (Sep) earnings of $0.67 per share, in-line with the Capital IQ Consensus Estimate consensus of $0.67; revenues fell 1.5% year/year to $218.5 mln vs the $221.07 mln consensus.
The gross margin in the third quarter was 47.9%, compared with 47.0% in the third quarter of 2012 and 48.0% the second quarter of 2013. Net bookings in the third quarter were $251.0 million, the highest in any quarter in the company's history. That compares with net bookings of $223.3 million in the third quarter of 2012 and $237.7 million in the second quarter of 2013.
Co issues in-line guidance for Q4, sees EPS of $0.87-0.97 vs. $0.92 Capital IQ Consensus Estimate; sees Q4 revs of $250-260 mln vs. $253.47 mln Capital IQ Consensus Estimate. Q4 bookings are expected to be at least $250 mln.
"Science bookings were particularly strong, up 16% sequentially and 33% compared with last year's third quarter, and were paced by record Life Sciences orders. Within Industry, Electronics bookings were up sequentially for the third quarter in a row. Revenue and earnings were within our expected ranges. Gross margin of 47.9% was up compared with last year's third quarter and keeps us on track toward our mid-2015 goal of 50%. Operating cash flow was again very strong. With our record backlog and continued strong bookings, we expect to exit the year with record fourth quarter revenue and earnings."
4:16PM Spreadtrum Comms announces mass production of WCDMA/HSPA+ smartphone chipset SC7710 (SPRD) 30.42 +0.02 : Co announced that it has achieved mass production of its SC7710 chipset, a single-core WCDMA/HSPA+ smartphone chipset designed for entry level 3G devices shipping globally
4:10PM Ixia beats by $0.01, reports revs in-line (XXIA) 14.56 +0.05 : Reports Q3 (Sep) earnings of $0.18 per share, excluding non-recurring items, $0.01 better than the Capital IQ Consensus Estimate of $0.17; revenues rose 4.3% year/year to $115.4 mln vs the $114.97 mln consensus.
"Anue and BreakingPoint revenue surpassed expectations and grew to $35.2 million, and our revenue from service providers and enterprise customers grew to 53% of our total revenue. We are on track with expanding our go-to-market channels and product portfolio, while at the same time managing our expenses."
4:06PM Ixia to acquire Net Optics for $190 mln in cash; expects the acquisition to be accretive to non-GAAP earnings by the second full quarter after the acquisition closes (XXIA) 14.56 +0.05 :
4:06PM Qiagen beats by $0.01, reports revs in-line; guides Q4 EPS below consensus; reaffirms FY13 EPS guidance, guides FY13 revs above consensus (QGEN) 21.92 +0.03 : Reports Q3 (Sep) earnings of $0.28 per share, $0.01 better than the Capital IQ Consensus Estimate of $0.27; revenues rose 6.4% year/year to $323.8 mln vs the $320.61 mln consensus.
4:05PM TriQuint Semi acknowledges receipt of starboard value letter (TQNT) 7.76 +0.419 : TQNT has issued the following response to the letter received from Starboard Value LP dated Oct 29th, 2013.
TriQuint welcomes constructive input from all shareholders including Starboard Value LP. TriQuint's Board of Directors and management regularly review the business strategy and have taken meaningful steps to increase shareholder value including the sale of underutilized equipment, share buybacks, as well as the withdrawal from unattractive businesses over time.
Given the investments that have been made over the past few years in premium filters combined with a comprehensive suite of complementary products, manufacturing technologies, and packaging options, TriQuint is uniquely positioned to address the current and future trends in the RF industry.
4:04PM Flextronics beats by $0.01, beats on revs; guides Q3 EPS below consensus, revs in-line (FLEX) 8.86 -0.12 : Reports Q2 (Sep) earnings of $0.22 per share, excluding non-recurring items, $0.01 better than the Capital IQ Consensus Estimate of $0.21; revenues rose 3.8% year/year to $6.41 bln vs the $6.28 bln consensus.
Co issues downside EPS guidance for Q3, sees EPS of $0.21-0.25, excluding non-recurring items, vs. $0.26 Capital IQ Consensus Estimate; sees Q3 revs of $6.5-6.9 bln vs. $6.8 bln Capital IQ Consensus Estimate.
4:04PM Cirrus Logic beats by $0.24, beats on revs; guides Q3 revs in-line (CRUS) 24.42 -0.24 : Reports Q2 (Sep) earnings of $0.84 per share, excluding non-recurring items, $0.24 better than the Capital IQ Consensus Estimate of $0.60; revenues fell 1.6% year/year to $190.7 mln vs the $181.43 mln consensus. Co reported Q2 Gross margin of 52 percent.
Co issues in-line guidance for Q3, sees Q3 revs of $200-220 mln vs. $202.93 mln Capital IQ Consensus Estimate. Co said Q3 Gross margin is expected to be between 45 percent and 47 percent.
"Q2 was another great quarter for Cirrus Logic as portable audio continued to be a key driver of our success and we made significant progress on our strategic initiatives...We are especially pleased with the addition of Acoustic Technologies to the Cirrus Logic team as they are expected to accelerate our progress toward our vision of being the preferred supplier of signal processing components."
4:02PM MagnaChip Semi beats by $0.05, reports revs in-line; guides Q4 revs below consensus (MX) 20.95 -0.83 : Reports Q3 (Sep) earnings of $0.76 per share, excluding non-recurring items, $0.05 better than the Capital IQ Consensus Estimate of $0.71; revenues fell 1.8% year/year to $217.8 mln vs the $219.7 mln consensus. Co issues downside guidance for Q4, sees Q4 revs of $193-203 mln vs. $207.8 mln Capital IQ Consensus Estimate.
Large Cap Gainers
NOK (7.32 +8.52%): Beat on EPS by EUR 0.02, missed on revs.
ACT (154.13 +5.67%): Reported EPS in-line, revs in-line; guided Q4 EPS above consensus; raised FY13 revs above consensus; guided FY14 EPS above consensus.
BP (45.84 +4.85%): Beat on EPS by $0.12.
Large Cap Losers
CMI (123 -8.83%): Missed on EPS by $0.17, missed on revs; lowered FY13 rev guidance; downgraded to Neutral at Robert W. Baird.
UBS (19.72 -7.72%): Missed on EPS by $0.03, missed on revs.
STX (47.99 -3.73%): Missed on EPS by $0.01, missed on revs; raised quarterly dividend by 13%; sees Q2 revs of $3.5-3.6 bln vs $3.63 bln consensus; tgt raised to $58 from $53 at Pacific Crest; upgraded to Hold from Sell at Craig-Hallum.
Mid Cap Gainers
JLL (96.77 +13.79%): Beat on EPS by $0.07, beat on revs.
XYL (32.75 +13.2%): Beat on EPS by $0.14, beat on revs; raised and guided FY13 EPS and revs above consensus; upgraded to Buy from Hold at Brean Capital; tgt $44.
PBI (21.43 +11.38%): Beat on EPS by $0.08, missed on revs; guided FY13 EPS in-line.
Mid Cap Losers
DAN (19.42 -14.24%): Missed on EPS by $0.07, missed on revs; lowered FY13 EPS below consensus, revs below consensus.
CVLT (74.88 -9.24%): Beat on EPS by $0.08, beat on revs.
MWV (35.51 -8.41%): Missed on EPS by $0.01, missed on revs; announced agreement with Plum Creek (PCL) to sell its U.S. Forestlands and form a new partnership for its South Carolina Real Estate assets.
Apple (AAPL 525.56, -4.32) is underperforming following its earnings report (although it would be remiss not to add that AAPL gained as much as 10% in the 12 sessions leading up to its report)
IBM (IBM 180.14, +2.79) is outperforming after announcing its Board declared a regular quarterly cash dividend of $0.95 per common share and authorized an additional $15 bln for its stock repurchase program
A rotation into less volatile names that has been fostered by a sense that the market, and higher-beta stocks, seem ripe for a pullback
IBM's performance has helped boost both the price-weighted Dow and the market-cap weighted S&P 500, both of which are hitting new session highs.
11:16AM Dell completes go-private transaction (DELL) 13.86 +0.03 : Co announced the completion of its acquisition by Michael Dell, Dell's Founder, Chairman and CEO, and Silver Lake Partners, a leading global technology investment firm. Under the terms of the merger agreement, Dell stockholders will receive $13.75 in cash for each share of Dell common stock they hold, plus payment of a special cash dividend of $0.13 per share to stockholders of record as of the close of business on Oct. 28, 2013, for total consideration of $13.88 per share in cash. The total transaction is valued at approximately $24.9 billion.
QuickLogic (QUIK) announced that the co's ArcticLink III VX and BX CSSP solutions are now included in Broadcom's (BRCM) Qualified Vendor List for an LVDS-based display bridging application supporting its BCM21663 Dual-core HSPA+ Multimedia Baseband Processor.
9:23AM Integrated Silicon misses by $0.06, misses on revs; guides Q1 EPS below consensus, revs below consensus (ISSI) 11.97 : Reports Q4 (Sep) earnings of $0.20 per share, $0.06 worse than the Capital IQ Consensus Estimate of $0.26; revenues rose 8.1% year/year to $78.4 mln vs the $80.18 mln consensus.
Guidance:
Co issues downside guidance for Q1, sees EPS of $0.17-0.21 vs. $0.27 Capital IQ Consensus Estimate
Co sees Q1 revs of $76-82 mln vs. $82.70 mln Capital IQ Consensus Estimate.
Gross margin for the December quarter is expected to range between 33-34%.
Operating expenses are expected to range between $21.5-22.5 mln.
The Company expects to realize additional gains on the Nanya shares in the December quarter.
Freescale (FSL) is collaborating with ARM (ARMH) and Oracle (ORCL) to add new vertical segment support for 'One Box' IoT gateway platform. The cos also team up on ARM mbed project to streamline development of edge/sensor nodes for the Internet of Things.
Atmel (ATML) has partnered with sensor and sensor fusion software manufacturers, accelerating embedded designers' ability to create smarter, connected devices including mobile sensor hubs, connected devices, wearables and Internet of Things applications.
Altera (ALTR) announced that its Stratix 10 SoC devices, manufactured on Intel's (INTC) 14 nm Tri-Gate process, will incorporate a high-performance, quad-core 64-bit ARM Cortex-A53 processor system.
Juniper Networks (JNPR) announced its flagship QFX5100 family of data center access switches which enable customers to achieve increased network performance, greater operational flexibility and higher availability.
7:27AM Nokia beats by EUR 0.02, misses on revs (NOK) 6.75 : Reports Q3 (Sep) earnings of 0.01 per share, excluding non-recurring items, 0.02 better than the Capital IQ Consensus Estimate of ( 0.01); revenues fell 21.8% year/year to 5.66 bln vs the 5.9 bln consensus.
If Nokia Group would have reported substantially all of its Devices & Services business as discontinued operations in the third quarter 2013 the net sales of its continuing operations would have been EUR 2.9 billion, which is EUR 2.8 billion lower than Nokia Group net sales of EUR 5.7 billion. However, Nokia Group's non-IFRS operating margin of its continuing operations would have been 11.5%, which is 7.7 percentage points higher than the third quarter 2013 non-IFRS operating margin of 3.8%.
- NSN Q3 net sales decreased 7% quarter-on-quarter to EUR 2.6 billion, primarily reflecting seasonality and NSN's strategic focus.
- HERE Q3 net sales decreased 9% quarter-on-quarter to EUR 0.2 billion, primarily due to lower seasonal sales to vehicle customers.
- Devices & Services Q3 net sales increased 6% quarter-on-quarter to EUR 2.9 billion.
- Lumia Q3 volumes increased 19% quarter-on-quarter to 8.8 million units, reflecting our recently broadened Lumia product range and strong customer demand, particularly for the Lumia 520.
- Mobile Phones Q3 volumes increased 4% quarter-on-quarter to 55.8 million units, demonstrating solid performance across the majority of our portfolio due to recently launched devices, particularly the Nokia 105, the Asha 501, and the Nokia 210.
- Nokia Group achieved underlying operating profitability for the fifth consecutive quarter, with a Q3 non-IFRS operating margin of 3.8%, driven by strong performances by Nokia Solutions and Networks (NSN) and HERE.
- Nokia Group ended Q3 with a strong balance sheet and solid cash position, with gross cash of EUR 9.1 billion and net cash of EUR 2.4 billion. Excluding the acquisition of Siemens' stake in NSN for EUR 1.7 billion, Nokia Group net cash was ~flat sequentially. At the end of Q3 NSN's contribution to Nokia Group gross and net cash was EUR 2.7 billion and EUR 1.5 billion, respectively.
6:09AM Cabot Micro beats by $0.11, beats on revs (CCMP) 39.12 : Reports Q4 (Sep) earnings of $0.70 per share, $0.11 better than the Capital IQ Consensus Estimate of $0.59; revenues rose 5.2% year/year to $116.3 mln vs the $112.72 mln consensus. This reflects an increase of 5.1 percent compared to the same quarter last year and an increase of 5.7 percent from the prior quarter, on solid demand for the company's products. The company achieved a gross profit margin of 50.9 percent of revenue in the fourth fiscal quarter, which is the highest level since December 2009.
"We are pleased with our strong financial performance for the quarter and full fiscal year, despite soft semiconductor industry conditions in the first half, and we believe the execution of our long-term strategic initiatives continues to create value for our customers and our shareholders."
Texas Instruments (TXN) announced the release of the Tiva C Series microcontroller platform.
07:48 am Seagate Tech shares fall 5% following miss on earnings/disappointing guidance
Seagate Tech (STX $47.45 -2.40) reported first quarter earnings of $1.29 per share, which missed expectations, while revenues fell 6.5% year/year to $3.49 million which is below expectations. The Board of Directors has approved an increase in the quarterly cash dividend of $0.05 from $0.38 per share in the previous quarter to $0.43 per share this quarter, an increase of ~13%. The company sees second quarter revs of $3.5-3.6 billion which is below expectations.
07:47 am Riverbed shares little changed following better than expected earnings
Riverbed Technology (RVBD $14.35 +0.00) reported third quarter earnings of $0.26 per share, excluding non-recurring items, which is better than expected, while GAAP revenues rose 19.7% year/year to $261.7 million; non-GAAP rev +21% to $265 million.
"In a mixed economic environment, which was particularly evident in the government vertical, Riverbed delivered solid third quarter results," said Jerry M. Kennelly, Riverbed chairman and CEO.
"Strong margin performance and prudent expense control drove higher profitability in the quarter," continued Kennelly. "We further demonstrated our commitment to driving shareholder value by executing a $50 million stock repurchase during the quarter, continuing our track record of returning a substantial amount of free cash flow to invest imatesors in the form of share repurchases." The company issued guidance for the fourth quarter with EPS of $0.26-0.27, which is line with expectations with revenues of $270-276 million which is below expectations."
Apple (AAPL) reported fourth quarter earnings of $8.26 per share, which is better than expected, while revenues rose 4.2% year/year to $37.47 billion which is better than expected, and and high end of $34-37 billion guidance; gross margin 37% versus high end of 36-37% guidance. iPhones sold 33.8 million in Q4 vs Street estimates of ~32 million. iPads 14.1 million vs Street estimates of ~14.5 million. Macs 4.6 million vs Street estimates of ~4.5 million. The company issued mixed guidance for Q1, sees Q1 revs of $55-58 billion which is line with expectations with gross margin 36.5-37.5% versus expectations of just below 38%.
Baird upgraded Apple (AAPL) to Outperform from Neutral and raised its tgt to $620 from $525. Firm had been concerned with the current product cycle, but with better-than-expected results now behind us, firm expects the focus to turn to 2014, which it believes holds more promise. Potential catalysts include a bigger screen iPhone, Apple TV, possible wearable devices and a likely China Mobile (CHL) launch. Additionally, firm also believes gross margins should hold steady in C2014 based on the current product lineup.
Tableau Software (DATA) reported third quarter earnings of $0.08 per share, which is higher than expected, while revenues rose 90.3% year/year to $61.1 million which is higher than expected.Lock up release will take effect on October 31, 2013, and the shares may be sold on or after that date.
Riverbed Technology (RVBD) reported third quarter earnings of $0.26 per share, excluding non-recurring items, which is better than expected, while GAAP revenues rose 19.7% year/year to $261.7 million; non-GAAP rev +21% to $265 million. "In a mixed economic environment, which was particularly evident in the government vertical, Riverbed delivered solid third quarter results," said Jerry M. Kennelly, Riverbed chairman and CEO. "Strong margin performance and prudent expense control drove higher profitability in the quarter," continued Kennelly. "We further demonstrated our commitment to driving shareholder value by executing a $50 million stock repurchase during the quarter, continuing our track record of returning a substantial amount of free cash flow to invest imatesors in the form of share repurchases." The company issued guidance for the fourth quarter with EPS of $0.26-0.27, which is line with expectations with revenues of $270-276 million which is below expectations.
Seagate Tech (STX) reported first quarter earnings of $1.29 per share, which missed expectations, while revenues fell 6.5% year/year to $3.49 million which is below expectations. The Board of Directors has approved an increase in the quarterly cash dividend of $0.05 from $0.38 per share in the previous quarter to $0.43 per share this quarter, an increase of ~13%. The company sees second quarter revs of $3.5-3.6 billion which is below expectations.
The tech-heavy Nasdaq posted a modest advance of 0.3% after the exchange experienced an intraday data dissemination issue that prevented index quotes from being sent out for nearly an hour. However, the issue was isolated to the index while individual components traded normally.
One of the components that contributed to the Nasdaq's underperformance was Apple (AAPL 516.68, -13.20). The largest tech stock lost 2.5% after its below-consensus gross margin guidance overshadowed its earnings beat on above-consensus revenue.
Despite Apple's relative weakness, the technology sector (+0.5%) ended in-line with the broader market, bolstered in part by the 2.7% gain in the shares of IBM (IBM 182.12, +4.77). Big Blue rallied after the company's Board of Directors authorized an additional $15 billion for its share buyback program. Chipmakers also contributed to the sector's strength as the PHLX Semiconductor Index advanced 1.5%.
Outside of technology, consumer discretionary (+0.6%) and energy (+0.7%) were the only other outperformers among cyclical sectors while financials, industrials, and materials ended with gains of 0.3% apiece.
The discretionary sector received support from homebuilders as all major builders posted gains while the iShares Dow Jones US Home Construction ETF (ITB 23.43, +0.32) rose 1.4%. Meanwhile, the energy sector was underpinned by BP (BP 45.90, +2.18) and Valero (VLO 40.21, +0.76) after both reported solid quarterly results.
Among countercyclical groups, utilities (+0.1%) lagged while consumer staples (+0.9%), health care (+0.7%), and telecom services (+1.5%) outperformed. Among earnings of note, Pfizer (PFE 31.25, +0.51) settled higher by 1.7% after beating bottom-line estimates by two cents on in-line revenue.
Treasuries ended on their highs as the 10-yr yield slipped two basis points to 2.50%.
With just two sessions left in October, the S&P is on track to post a solid monthly advance of 5.3%. While the month-to-date gain is impressive, the S&P 500's performance over the past 15 sessions has been even more eye-popping. Since October 8, the index has gained more than 7.0%. Investors will receive the latest policy statement from the Federal Open Market Committee tomorrow, but the markets are expecting the FOMC decision to be a non-event.
Trading volume was on the light side as just over 680 million shares changed hands on the floor of the New York Stock Exchange. Today's economic data was plentiful, but did little to suggest the Federal Reserve will be eager to curtail the pace of its asset purchases in the near term.
The Conference Board's Consumer Confidence Index plummeted in October, falling from an upwardly revised 80.2 (from 79.7) to 71.2 (73.1 Briefing.com consensus). The entire decline in confidence can be attributed to the reaction to the government shutdown and near-default by the U.S. Treasury.
Typically, confidence levels are influenced by equity trends, oil prices, labor conditions, and media reports. Other than the negative media attention on the shutdown, all of the typical components moved in a positive direction in October. If these trends continue in November, the Consumer Confidence Index should slowly return to at least September levels.
Separately, September retail sales declined 0.1% to follow an August increase of 0.2% (-0.1% Briefing.com consensus). The headline decline in retail sales masked an otherwise strong report, especially considering that private payroll growth was much weaker than expected.
The entire decline in sales was the result of a 2.2% drop in motor vehicle demand. Motor vehicle manufacturers already showed that August sales were boosted by calendar effects stemming from an extra weekend and the Labor Day holiday. With those biases removed, sales were set to decline substantially in September, which translated into the 2.2% drop in motor vehicle sales.
Total business inventories increased 0.3% in August after increasing 0.4% in July (+0.2% Briefing.com consensus).
Also of note, September producer prices fell 0.1% after increasing 0.3% in August (+0.2% Briefing.com consensus). That was the first monthly decline since prices fell 0.7% in April.
Food prices unexpectedly declined 1.0% in September after increasing 0.5% in August. A 17.9% drop in fresh and dry vegetables prices contributed to most of the September decline. Those prices increased 26.9% in August.
Tomorrow, the weekly MBA Mortgage Index will be reported at 7:00 ET, October ADP Employment Change will be released at 8:15 ET, and September CPI will cross the wires at 8:30 ET. In addition, the FOMC will release its latest policy statement at 14:15 ET. On the earnings front, General Motors (GM 36.06, +0.26), Comcast (CMCSA 47.71, -0.52), and Exelon (EXC 28.05, -0.02) will report their results ahead of the opening bell.DJ30 +111.42 NASDAQ +12.21 SP500 +9.84 NASDAQ Adv/Vol/Dec 1505/1.81 bln/1040 NYSE Adv/Vol/Dec 1856/682.6 mln/1136
3:30 pm :
Dec gold chopped around in negative territory today as a stronger dollar index pressured prices. The yellow metal brushed a session high of $1352.90 per ounce in late morning pit trade but was unable to sustain the momentum. It settled 0.5% lower at $1345.30 per ounce, slightly above its session low of $1342.40 per ounce
Dec silver spent most of the session trading near the unchanged line after lifting from a session low of$22.38 per ounce set in early morning pit trade. It eventually settled with a 0.1% loss at $22.49 per ounce
Dec crude oil fell for the first time in four sessions as the dollar index advanced. The energy component traded as low as $97.82 per barrel and settled with a 0.4% loss at $98.26 per barrel
Dec natural gas retreated back into negative territory after touching a session high of $3.67 per MMBtu in early morning pit trade. It settled 0.8% lower at $3.63 per MMBtu.
4:51PM Nanometrics beats by $0.02, beats on revs; guides Q4 EPS in-line, revs in-line (NANO) 16.38 -0.49 : Reports Q3 (Sep) loss of $0.06 per share, excluding non-recurring items, $0.02 better than the Capital IQ Consensus Estimate of ($0.08); revenues fell 11.1% year/year to $39.0 mln vs the $38.6 mln consensus. Co issues in-line guidance for Q4, sees EPS of $(0.08)-0.03, excluding non-recurring items, vs. $0.00 Capital IQ Consensus Estimate; sees Q4 revs of $42-47 mln vs. $44.2 mln Capital IQ Consensus Estimate.
4:47PM Rubicon Tech misses by $0.04, beats on revs; guides Q4 EPS below consensus (RBCN) 9.07 -0.10 : Reports Q3 (Sep) loss of $0.26 per share, $0.04 worse than the Capital IQ Consensus Estimate of ($0.22); revenues fell 44.2% year/year to $11.1 mln vs the $10.78 mln consensus. Co issues downside guidance for Q4, sees EPS of ($0.24)-($0.22) vs. ($0.11) Capital IQ Consensus Estimate.
Commenting on the outlook for the fourth quarter of 2013, Mr. Weissman said, "We believe sapphire demand will continue to strengthen and we expect pricing for two and four-inch cores to be higher in the fourth quarter and have added some additional core fabrication capacity. With lower than expected wafer orders from the SoS market, our wafer revenue will be lower in the fourth quarter, offsetting most of the sequential price and volume increases for two and four-inch core. Therefore, we are expecting fourth quarter revenue to be similar to the third quarter (Cap IQ Q4 revenue consensus is $13.7 mln). We are very optimistic about wafer demand next year but it could take another couple of quarters to see a meaningful improvement in wafer orders. Idle plant costs will remain high in the fourth quarter but we will begin to see some reduction in idle plant costs as we have now started the process of re-starting idle crystal growth furnaces.
"With the rising demand for sapphire, pricing has been steadily rising and current market pricing, which will be reflected in our fourth quarter numbers, is now back to approximately break-even for our two and four inch core products. Given the momentum of the LED general lighting market and introduction of new applications for sapphire, we expect pricing to continue to strengthen going into next year." The Company announced the launch of its four and six-inch patterned wafer product ("PSS") and reported that seven tier-one LED chip manufacturers have already requested samples. "We are very pleased with the customer response thus far and believe that PSS will be a strong growth driver for our wafer business," Mr. Parvez said. "While we are a few quarters away from volume production orders, we believe that PSS wafer sales should generate at least $15 million in revenue for us in 2014."
The Company also reported that orders from their major SoS customer are very limited due to excess wafer inventory at the customer. That customer is also introducing new RF chips that will be produced on SoI rather than SoS starting early next year. Therefore future sapphire purchases from that customer will likely be lower than they have been historically.
4:20PM FEI reports EPS in-line, misses on revs; guides Q4 EPS in-line, revs in-line (FEIC) 89.14 : Reports Q3 (Sep) earnings of $0.67 per share, in-line with the Capital IQ Consensus Estimate consensus of $0.67; revenues fell 1.5% year/year to $218.5 mln vs the $221.07 mln consensus.
The gross margin in the third quarter was 47.9%, compared with 47.0% in the third quarter of 2012 and 48.0% the second quarter of 2013. Net bookings in the third quarter were $251.0 million, the highest in any quarter in the company's history. That compares with net bookings of $223.3 million in the third quarter of 2012 and $237.7 million in the second quarter of 2013.
Co issues in-line guidance for Q4, sees EPS of $0.87-0.97 vs. $0.92 Capital IQ Consensus Estimate; sees Q4 revs of $250-260 mln vs. $253.47 mln Capital IQ Consensus Estimate. Q4 bookings are expected to be at least $250 mln.
"Science bookings were particularly strong, up 16% sequentially and 33% compared with last year's third quarter, and were paced by record Life Sciences orders. Within Industry, Electronics bookings were up sequentially for the third quarter in a row. Revenue and earnings were within our expected ranges. Gross margin of 47.9% was up compared with last year's third quarter and keeps us on track toward our mid-2015 goal of 50%. Operating cash flow was again very strong. With our record backlog and continued strong bookings, we expect to exit the year with record fourth quarter revenue and earnings."
4:16PM Spreadtrum Comms announces mass production of WCDMA/HSPA+ smartphone chipset SC7710 (SPRD) 30.42 +0.02 : Co announced that it has achieved mass production of its SC7710 chipset, a single-core WCDMA/HSPA+ smartphone chipset designed for entry level 3G devices shipping globally
4:10PM Ixia beats by $0.01, reports revs in-line (XXIA) 14.56 +0.05 : Reports Q3 (Sep) earnings of $0.18 per share, excluding non-recurring items, $0.01 better than the Capital IQ Consensus Estimate of $0.17; revenues rose 4.3% year/year to $115.4 mln vs the $114.97 mln consensus.
"Anue and BreakingPoint revenue surpassed expectations and grew to $35.2 million, and our revenue from service providers and enterprise customers grew to 53% of our total revenue. We are on track with expanding our go-to-market channels and product portfolio, while at the same time managing our expenses."
4:06PM Ixia to acquire Net Optics for $190 mln in cash; expects the acquisition to be accretive to non-GAAP earnings by the second full quarter after the acquisition closes (XXIA) 14.56 +0.05 :
4:06PM Qiagen beats by $0.01, reports revs in-line; guides Q4 EPS below consensus; reaffirms FY13 EPS guidance, guides FY13 revs above consensus (QGEN) 21.92 +0.03 : Reports Q3 (Sep) earnings of $0.28 per share, $0.01 better than the Capital IQ Consensus Estimate of $0.27; revenues rose 6.4% year/year to $323.8 mln vs the $320.61 mln consensus.
4:05PM TriQuint Semi acknowledges receipt of starboard value letter (TQNT) 7.76 +0.419 : TQNT has issued the following response to the letter received from Starboard Value LP dated Oct 29th, 2013.
TriQuint welcomes constructive input from all shareholders including Starboard Value LP. TriQuint's Board of Directors and management regularly review the business strategy and have taken meaningful steps to increase shareholder value including the sale of underutilized equipment, share buybacks, as well as the withdrawal from unattractive businesses over time.
Given the investments that have been made over the past few years in premium filters combined with a comprehensive suite of complementary products, manufacturing technologies, and packaging options, TriQuint is uniquely positioned to address the current and future trends in the RF industry.
4:04PM Flextronics beats by $0.01, beats on revs; guides Q3 EPS below consensus, revs in-line (FLEX) 8.86 -0.12 : Reports Q2 (Sep) earnings of $0.22 per share, excluding non-recurring items, $0.01 better than the Capital IQ Consensus Estimate of $0.21; revenues rose 3.8% year/year to $6.41 bln vs the $6.28 bln consensus.
Co issues downside EPS guidance for Q3, sees EPS of $0.21-0.25, excluding non-recurring items, vs. $0.26 Capital IQ Consensus Estimate; sees Q3 revs of $6.5-6.9 bln vs. $6.8 bln Capital IQ Consensus Estimate.
4:04PM Cirrus Logic beats by $0.24, beats on revs; guides Q3 revs in-line (CRUS) 24.42 -0.24 : Reports Q2 (Sep) earnings of $0.84 per share, excluding non-recurring items, $0.24 better than the Capital IQ Consensus Estimate of $0.60; revenues fell 1.6% year/year to $190.7 mln vs the $181.43 mln consensus. Co reported Q2 Gross margin of 52 percent.
Co issues in-line guidance for Q3, sees Q3 revs of $200-220 mln vs. $202.93 mln Capital IQ Consensus Estimate. Co said Q3 Gross margin is expected to be between 45 percent and 47 percent.
"Q2 was another great quarter for Cirrus Logic as portable audio continued to be a key driver of our success and we made significant progress on our strategic initiatives...We are especially pleased with the addition of Acoustic Technologies to the Cirrus Logic team as they are expected to accelerate our progress toward our vision of being the preferred supplier of signal processing components."
4:02PM MagnaChip Semi beats by $0.05, reports revs in-line; guides Q4 revs below consensus (MX) 20.95 -0.83 : Reports Q3 (Sep) earnings of $0.76 per share, excluding non-recurring items, $0.05 better than the Capital IQ Consensus Estimate of $0.71; revenues fell 1.8% year/year to $217.8 mln vs the $219.7 mln consensus. Co issues downside guidance for Q4, sees Q4 revs of $193-203 mln vs. $207.8 mln Capital IQ Consensus Estimate.
Large Cap Gainers
NOK (7.32 +8.52%): Beat on EPS by EUR 0.02, missed on revs.
ACT (154.13 +5.67%): Reported EPS in-line, revs in-line; guided Q4 EPS above consensus; raised FY13 revs above consensus; guided FY14 EPS above consensus.
BP (45.84 +4.85%): Beat on EPS by $0.12.
Large Cap Losers
CMI (123 -8.83%): Missed on EPS by $0.17, missed on revs; lowered FY13 rev guidance; downgraded to Neutral at Robert W. Baird.
UBS (19.72 -7.72%): Missed on EPS by $0.03, missed on revs.
STX (47.99 -3.73%): Missed on EPS by $0.01, missed on revs; raised quarterly dividend by 13%; sees Q2 revs of $3.5-3.6 bln vs $3.63 bln consensus; tgt raised to $58 from $53 at Pacific Crest; upgraded to Hold from Sell at Craig-Hallum.
Mid Cap Gainers
JLL (96.77 +13.79%): Beat on EPS by $0.07, beat on revs.
XYL (32.75 +13.2%): Beat on EPS by $0.14, beat on revs; raised and guided FY13 EPS and revs above consensus; upgraded to Buy from Hold at Brean Capital; tgt $44.
PBI (21.43 +11.38%): Beat on EPS by $0.08, missed on revs; guided FY13 EPS in-line.
Mid Cap Losers
DAN (19.42 -14.24%): Missed on EPS by $0.07, missed on revs; lowered FY13 EPS below consensus, revs below consensus.
CVLT (74.88 -9.24%): Beat on EPS by $0.08, beat on revs.
MWV (35.51 -8.41%): Missed on EPS by $0.01, missed on revs; announced agreement with Plum Creek (PCL) to sell its U.S. Forestlands and form a new partnership for its South Carolina Real Estate assets.
Apple (AAPL 525.56, -4.32) is underperforming following its earnings report (although it would be remiss not to add that AAPL gained as much as 10% in the 12 sessions leading up to its report)
IBM (IBM 180.14, +2.79) is outperforming after announcing its Board declared a regular quarterly cash dividend of $0.95 per common share and authorized an additional $15 bln for its stock repurchase program
A rotation into less volatile names that has been fostered by a sense that the market, and higher-beta stocks, seem ripe for a pullback
IBM's performance has helped boost both the price-weighted Dow and the market-cap weighted S&P 500, both of which are hitting new session highs.
11:16AM Dell completes go-private transaction (DELL) 13.86 +0.03 : Co announced the completion of its acquisition by Michael Dell, Dell's Founder, Chairman and CEO, and Silver Lake Partners, a leading global technology investment firm. Under the terms of the merger agreement, Dell stockholders will receive $13.75 in cash for each share of Dell common stock they hold, plus payment of a special cash dividend of $0.13 per share to stockholders of record as of the close of business on Oct. 28, 2013, for total consideration of $13.88 per share in cash. The total transaction is valued at approximately $24.9 billion.
QuickLogic (QUIK) announced that the co's ArcticLink III VX and BX CSSP solutions are now included in Broadcom's (BRCM) Qualified Vendor List for an LVDS-based display bridging application supporting its BCM21663 Dual-core HSPA+ Multimedia Baseband Processor.
9:23AM Integrated Silicon misses by $0.06, misses on revs; guides Q1 EPS below consensus, revs below consensus (ISSI) 11.97 : Reports Q4 (Sep) earnings of $0.20 per share, $0.06 worse than the Capital IQ Consensus Estimate of $0.26; revenues rose 8.1% year/year to $78.4 mln vs the $80.18 mln consensus.
Guidance:
Co issues downside guidance for Q1, sees EPS of $0.17-0.21 vs. $0.27 Capital IQ Consensus Estimate
Co sees Q1 revs of $76-82 mln vs. $82.70 mln Capital IQ Consensus Estimate.
Gross margin for the December quarter is expected to range between 33-34%.
Operating expenses are expected to range between $21.5-22.5 mln.
The Company expects to realize additional gains on the Nanya shares in the December quarter.
Freescale (FSL) is collaborating with ARM (ARMH) and Oracle (ORCL) to add new vertical segment support for 'One Box' IoT gateway platform. The cos also team up on ARM mbed project to streamline development of edge/sensor nodes for the Internet of Things.
Atmel (ATML) has partnered with sensor and sensor fusion software manufacturers, accelerating embedded designers' ability to create smarter, connected devices including mobile sensor hubs, connected devices, wearables and Internet of Things applications.
Altera (ALTR) announced that its Stratix 10 SoC devices, manufactured on Intel's (INTC) 14 nm Tri-Gate process, will incorporate a high-performance, quad-core 64-bit ARM Cortex-A53 processor system.
Juniper Networks (JNPR) announced its flagship QFX5100 family of data center access switches which enable customers to achieve increased network performance, greater operational flexibility and higher availability.
7:27AM Nokia beats by EUR 0.02, misses on revs (NOK) 6.75 : Reports Q3 (Sep) earnings of 0.01 per share, excluding non-recurring items, 0.02 better than the Capital IQ Consensus Estimate of ( 0.01); revenues fell 21.8% year/year to 5.66 bln vs the 5.9 bln consensus.
If Nokia Group would have reported substantially all of its Devices & Services business as discontinued operations in the third quarter 2013 the net sales of its continuing operations would have been EUR 2.9 billion, which is EUR 2.8 billion lower than Nokia Group net sales of EUR 5.7 billion. However, Nokia Group's non-IFRS operating margin of its continuing operations would have been 11.5%, which is 7.7 percentage points higher than the third quarter 2013 non-IFRS operating margin of 3.8%.
- NSN Q3 net sales decreased 7% quarter-on-quarter to EUR 2.6 billion, primarily reflecting seasonality and NSN's strategic focus.
- HERE Q3 net sales decreased 9% quarter-on-quarter to EUR 0.2 billion, primarily due to lower seasonal sales to vehicle customers.
- Devices & Services Q3 net sales increased 6% quarter-on-quarter to EUR 2.9 billion.
- Lumia Q3 volumes increased 19% quarter-on-quarter to 8.8 million units, reflecting our recently broadened Lumia product range and strong customer demand, particularly for the Lumia 520.
- Mobile Phones Q3 volumes increased 4% quarter-on-quarter to 55.8 million units, demonstrating solid performance across the majority of our portfolio due to recently launched devices, particularly the Nokia 105, the Asha 501, and the Nokia 210.
- Nokia Group achieved underlying operating profitability for the fifth consecutive quarter, with a Q3 non-IFRS operating margin of 3.8%, driven by strong performances by Nokia Solutions and Networks (NSN) and HERE.
- Nokia Group ended Q3 with a strong balance sheet and solid cash position, with gross cash of EUR 9.1 billion and net cash of EUR 2.4 billion. Excluding the acquisition of Siemens' stake in NSN for EUR 1.7 billion, Nokia Group net cash was ~flat sequentially. At the end of Q3 NSN's contribution to Nokia Group gross and net cash was EUR 2.7 billion and EUR 1.5 billion, respectively.
6:09AM Cabot Micro beats by $0.11, beats on revs (CCMP) 39.12 : Reports Q4 (Sep) earnings of $0.70 per share, $0.11 better than the Capital IQ Consensus Estimate of $0.59; revenues rose 5.2% year/year to $116.3 mln vs the $112.72 mln consensus. This reflects an increase of 5.1 percent compared to the same quarter last year and an increase of 5.7 percent from the prior quarter, on solid demand for the company's products. The company achieved a gross profit margin of 50.9 percent of revenue in the fourth fiscal quarter, which is the highest level since December 2009.
"We are pleased with our strong financial performance for the quarter and full fiscal year, despite soft semiconductor industry conditions in the first half, and we believe the execution of our long-term strategic initiatives continues to create value for our customers and our shareholders."
Texas Instruments (TXN) announced the release of the Tiva C Series microcontroller platform.
07:48 am Seagate Tech shares fall 5% following miss on earnings/disappointing guidance
Seagate Tech (STX $47.45 -2.40) reported first quarter earnings of $1.29 per share, which missed expectations, while revenues fell 6.5% year/year to $3.49 million which is below expectations. The Board of Directors has approved an increase in the quarterly cash dividend of $0.05 from $0.38 per share in the previous quarter to $0.43 per share this quarter, an increase of ~13%. The company sees second quarter revs of $3.5-3.6 billion which is below expectations.
07:47 am Riverbed shares little changed following better than expected earnings
Riverbed Technology (RVBD $14.35 +0.00) reported third quarter earnings of $0.26 per share, excluding non-recurring items, which is better than expected, while GAAP revenues rose 19.7% year/year to $261.7 million; non-GAAP rev +21% to $265 million.
"In a mixed economic environment, which was particularly evident in the government vertical, Riverbed delivered solid third quarter results," said Jerry M. Kennelly, Riverbed chairman and CEO.
"Strong margin performance and prudent expense control drove higher profitability in the quarter," continued Kennelly. "We further demonstrated our commitment to driving shareholder value by executing a $50 million stock repurchase during the quarter, continuing our track record of returning a substantial amount of free cash flow to invest imatesors in the form of share repurchases." The company issued guidance for the fourth quarter with EPS of $0.26-0.27, which is line with expectations with revenues of $270-276 million which is below expectations."
Apple (AAPL) reported fourth quarter earnings of $8.26 per share, which is better than expected, while revenues rose 4.2% year/year to $37.47 billion which is better than expected, and and high end of $34-37 billion guidance; gross margin 37% versus high end of 36-37% guidance. iPhones sold 33.8 million in Q4 vs Street estimates of ~32 million. iPads 14.1 million vs Street estimates of ~14.5 million. Macs 4.6 million vs Street estimates of ~4.5 million. The company issued mixed guidance for Q1, sees Q1 revs of $55-58 billion which is line with expectations with gross margin 36.5-37.5% versus expectations of just below 38%.
Baird upgraded Apple (AAPL) to Outperform from Neutral and raised its tgt to $620 from $525. Firm had been concerned with the current product cycle, but with better-than-expected results now behind us, firm expects the focus to turn to 2014, which it believes holds more promise. Potential catalysts include a bigger screen iPhone, Apple TV, possible wearable devices and a likely China Mobile (CHL) launch. Additionally, firm also believes gross margins should hold steady in C2014 based on the current product lineup.
Tableau Software (DATA) reported third quarter earnings of $0.08 per share, which is higher than expected, while revenues rose 90.3% year/year to $61.1 million which is higher than expected.Lock up release will take effect on October 31, 2013, and the shares may be sold on or after that date.
Riverbed Technology (RVBD) reported third quarter earnings of $0.26 per share, excluding non-recurring items, which is better than expected, while GAAP revenues rose 19.7% year/year to $261.7 million; non-GAAP rev +21% to $265 million. "In a mixed economic environment, which was particularly evident in the government vertical, Riverbed delivered solid third quarter results," said Jerry M. Kennelly, Riverbed chairman and CEO. "Strong margin performance and prudent expense control drove higher profitability in the quarter," continued Kennelly. "We further demonstrated our commitment to driving shareholder value by executing a $50 million stock repurchase during the quarter, continuing our track record of returning a substantial amount of free cash flow to invest imatesors in the form of share repurchases." The company issued guidance for the fourth quarter with EPS of $0.26-0.27, which is line with expectations with revenues of $270-276 million which is below expectations.
Seagate Tech (STX) reported first quarter earnings of $1.29 per share, which missed expectations, while revenues fell 6.5% year/year to $3.49 million which is below expectations. The Board of Directors has approved an increase in the quarterly cash dividend of $0.05 from $0.38 per share in the previous quarter to $0.43 per share this quarter, an increase of ~13%. The company sees second quarter revs of $3.5-3.6 billion which is below expectations.
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