Tag: profits

Samsung boss out of coma

Samsung supremo Lee Kun-hee has woken up from his coma, a fortnight after he suffered a heart attack after his family made a bit of noise in his sick room.

Apparently bored family members were watching a baseball game while visiting, and were “making noise” when Samsung Lions hitter Lee Seung-yeop hit a home run. This woke Lee up from his coma which should indicate they made a bit of noise.

Lee has been under treatment at the Samsung Medical Centre in southern Seoul, where he had initially been treated in intensive care before being shifted to a ward.

The hospital says the prognosis for his cognitive functions is “hopeful.”

The 72 year old was hospitalised on May 11. He has limited involvement with the firm these days, and the Korea Herald reports that the company’s share price has risen on expectations that it will expedite “managerial succession to Lee’s children.”

This means that Lee Jay-yong, Lee’s only son, would find himself in charge of an industrial giant which represents a quarter of South Korea’s GDP. 

Sony slashes OLED TV production

As we expected, Sony has walked away from the idea of OLED tellies, according to the Japanese Nikkei newspaper.

Mr Accountant San has ordered the end of all of its development around commercial OLED TVs in order to concentrate on 4K Ultra HD products with more traditional LED/LCD panels.

The take down is interesting because Sony was first to market when it came to OLED TVs. In 2008, it released to XEL-1, an 11-inch OLED TV for US$2,500.

While manufacturers promised OLED technology, the high manufacturing costs and lifespan issues made products as rare as hen’s teeth.

Things appeared to change in 2013 when Sony started showing off 4K OLED TVs that things started to change. However, 4K Ultra HD resolution on a LED screen is cheaper and better for manufacturers. Sony did well with the technology and it made up 20 percent of the total value of global shipments of 4K TV. Nikkei thinks that half of Sony’s line-up will be 4K models.

The change means that Sony can reduce the workforce of its consumer electronics division by a fifth. 

Sony slashes profits again

Sony is warning that it will have another steep decline in profits, which suggests that chief executive Kazuo Hirai might be making a trip to the car park, writing a haiku about the briefness of life before hacking into his stomach with a steak knife while his secretary covers him with cherry blossom.

Hirai is not fulfilling the promises he made upon becoming Shogun of the electronics giant two years ago to push electronics into the black. There is also his five cuts to earnings guidance during his reign and this is just two weeks before Sony announces full year results.

What makes matters worse is that he is doing all this while rebuffing advice from billionaire hedge fund manager Daniel Loeb’s to spin off Sony’s profitable entertainment business.

Sony cut its forecast for operating profit to $254.53 million for the business year ended in March from a previous estimate.

The problem appears to be the Vaio PC unit which is still costing the company a fortune and the disk production unit,  which is being kicked to death by  online streaming services.

Sony widened its annual net loss estimate to 130 billion yen from the 110 billion it forecast in February, when it reversed a previous profit outlook.

Its rival Panasonic has staged a revival from deep losses by embracing industrial products and selling to businesses rather than consumers. But it has beaten its conservative forecasts while Sony has become known for missing overly optimistic outlooks.

Before Thursday’s cut, Sony had missed its forecasts in 10 of the prior 12 years, excluding gains from asset sales, the worst among 30 Japanese consumer electronics makers, analysts at brokerage firm Jefferies calculated in March.

By comparison, Panasonic, with the best record, exceeded its guidance nine times over the same period.

SAP fears volatile exchange rates

The German maker of expensive business software maker, which no one is sure what it does, has warned that volatile exchange rates keep it awake at night.

SAP warned that it expected the negative impact of volatile exchange rates to worsen in the second quarter because of the strong euro.

The euro is fast becoming too strong for outfits like SAP which rely on cash from the Americas and the Land of the Rising Sun.

The euro has climbed 2.3 percent against the US dollar and nearly six percent against Japan’s yen in the past six months.

SAP said its software and software-related service revenues would take a six percentage point hit in the second quarter if exchange rates remained at March levels. Operating profit excluding special items would be eight percentage points lower.

In the first quarter, a strong exchange rate had a first-quarter impact of five percentage points on both software and software-related service revenues and operating profit.

For the full year, SAP expects operating profit will be negatively impacted by 5 percentage points.

SAP reported a two percent rise in first-quarter operating profit, excluding special items, to $1.271 billion fuelled by its web-based software products.

This was well below what the City thought SAP would make. In fact it predicted $1.329 billion would be a nice round sum.

Things are OK for the outfit in the EU. The company said it saw a solid regional performance in Europe, despite uncertainties in Russia amid the Crimea crisis.

First-quarter revenue rose 2 percent to $5.12 billion, helped by SAP’s internet computing, or cloud business, where revenues jumped more than a third to $305.82 million.

Earlier this year, SAP pushed back its profit target as it waits for subscription revenue from cloud-computing to make it more dosh.


Amazon’s growth slows

Amazon’s revenues slowed in the first quarter as the world’s largest Internet retail struggled overseas.

The company reported that margins jumped on lower shipping expenses and the expansion of more profitable new businesses.

It would appear that things are looking up in the US but on the international markets Amazon is not doing so well.

Europe’s economies, which have been raped by austerity demands, are harming corporate sales in the region. EBay, Amazon’s main rival, also reported disappointing results last week and noted European weakness.

Amazon’s revenue rose 22 percent to $16.07 billion, with most of the cash coming from growing sales of digital content, cloud-computing services and gains in its main retail business.  However this was a decline from 36 percent growth in the first quarter of last year.

International revenue rose 16 percent in the most-recent quarter, down from a 31 percent growth rate last year.

Amazon CFO Tom Szkutak said Amazon was suffering in the same way that others were.

Amazon has also struggled to grow in China but Szkutak believes that the company is still in “investment mode” in that country so that is nothing to worry about for now.

Total year-over-year unit growth, which measures the number of items Amazon sells, was 30 percent in the first quarter, down from 49 percent in the first quarter of 2012.

Amazon forecast second-quarter revenue of $14.5 billion to $16.2 billion and operating results from break-even to $350 million.

The cocaine nose jobs of Wall Street wanted to see second-quarter revenue of $15.94 billion and operating results of $452 million.

The figures do show that, despite weaker growth and a cautious forecast, Amazon is becoming more profitable.

Amazon is currently building distribution warehouses closer to customers, reducing shipping costs. It has also been charging third-party merchants on its marketplace higher fees for shipping and warehouse storage.

Nokia back from the dead

Former rubber boot maker Nokia is likely to report that it has come back from the dead.

The cocaine nose jobs of Wall Street are expecting to hear some good news from Nokia when it announces its results in the first quarter any day now.

This is all thanks to rising Lumia smartphone sales and a turnaround at its equipment venture Nokia Siemens Networks (NSN).

Nokia has recently launched the Lumia handsets in China where consumers have been increasingly turning from regular phones to smartphones.

Reuters expects quarterly shipments of 5.6 million Lumia handsets, up from 4.4 million in the fourth quarter.

The company’s underlying loss, which excludes special items, is shrinking.

This is expected to take some pressure off CEO Stephen Elop, who was hired in 2010 to lead a turnaround at Nokia.

He made a controversial decision to switch to the untried Windows software.

Some cynics say that it’s too early to sound the all-clear. Nokia’s cash position has fallen to 3.7 billion from 4.4 billion three months earlier.

Investors also point out that the smartphone industry’s top two players, Samsung and Apple, show little signs of ceding market share.

But analysts on average expect Lumia shipments to pick up to over seven million units next quarter. If it does not increase then the doubts about Nokia’s future will return. 

AMD's TressFX ruffles Lara Croft's barnet

AMD has finally sorted out the problems of rendering realistic hair which has made graphics look like rubbish for years.

TressFX Hair, which will first see the light of day in the latest edition of Tomb Raider, will mean that game developers can actually come up with realistic skin, hair, and facial animation.

Nvidia has also had a crack at it and the PhysX engine will probably have a hair component under the bonnet. AMD, however, has not only beaten the Green Goblin to the punch, but got a decent partner to promote the tech too.

TressFX not only works in a playable game, it will also work on any DirectX 11 card.

According to a statement, the DirectX 11 treats each strand of hair as a chain with dozens of links. This allows forces like gravity, wind and movement of the head to move and curl Lara Croft’s hair in a realistic fashion.

Collision detection is performed to ensure that strands do not pass through one another, or other solid surfaces such as Lara’s head, clothing and body.

Hair styles are simulated by gradually pulling the strands back towards their original shape after they have moved in response to an external force.

If AMD has pulled this off properly, then it will mean much for creating richer characters, creatures, and, potentially, worlds. It is not just hair that has the problem of looking fake, there are objects like moving trees and grass which will suddenly get a makeover. 

HTC profits tank

Mobile phone maker HTC has seen its profit fall 91 percent in the fourth quarter of 2012.

According to the IB Times, the company posted a net profit of £22 million for the three months to the end of December. Last year it made £242 million in the same quarter last year.

It is fairly clear that the result was expected. CEO Peter Chou told the Wall Street Journal in January that the company’s competition is too strong and resourceful.

Samsung and Apple had been pouring in lots of money into marketing, and HTC hadn’t.

However, he did say that he thought “2013 will not be too bad”.

Analysts suggest that HTC has hit its low point and unless there is a disaster, like the company’s flagship M7 sales disappointing, HTC should pick itself off the ground and dust itself off.

HTC is expected to announce the M7 on 19 February. Apparently a launch venue in London has been booked.

The M7 smartphone is thought to feature a 4.7 or 5in full-HD screen, a 1.7GHz quad-core processor and a 13-megapixel camera.

If the phone is not launched on 19 February, then it will almost certainly be seen at Mobile World Congress in Barcelona.

Launching early will give HTC the chance to steal the march on Samsung which is expected to unveil the next model in the Galaxy range this April. 

AMD outlines its cunning plan for profitability

When things started to go badly for AMD a few years back it demanded the head of its CEO for not spotting the mobile revolution. But, as the company talked about its cunning plans, the mobile was largely off the agenda.

AMD had a rubbish 2012 and things were not exactly going well for it before that. Earlier this week the firm’s quarter showed a loss of $473 million, including charges related to restructuring and the reduction of buying obligations from contract chipmaker GlobalFoundries. AMD’s fourth-quarter revenue fell 32 percent to $1.16 billion.

Yet AMD hopes to be profitable by the end of fiscal 2013 with the help of new products and a boost from its custom chip business.

The moves include releasing new chips this year for laptops and tablets and generating more revenue from its embedded and custom chip business, the executives said. Given that AMD was supposed to be in trouble for not spotting the so called mobile revolution, its hopes to be in profit by the end of the year without doing much about it are interesting.

What it suggests is something which we have been saying for a while – the mobile boom is separate from the PC slump. The PC slump is due to a suffering economy. If or when that picks up, so will PC sales.

This makes AMD’s plan more sense. The outfit has been selling off its assets, cutting back on R&D and has laid off 15 percent of its workforce. This makes no sense if you have to find a way of getting into the mythical mobile computing boom. It seems more reasonable if you are cutting back to hold down the fort until the economy picks up. AMD seems, quite rationally, to think that deals with ARM are better than wasting its own money chasing the low powered mobile chip market.

CEO Rory Read expects “continued choppiness in the PC market in the first half of 2013”, and said he will closely manage the business as AMD is reset, restructured and ultimately transformed.

The release of new A8 and A10 quad-core chips later this year should boost AMD’s core processor business. The chips, code-named Richland, will deliver up to 40 percent more performance than AMD’s existing Trinity chips. They will be appearing in PCs in the first half of this year, ahead of the important back-to-school and holiday PC sales cycle in the second half.

In fact the only sops to the “mobile revolution” is the launch of chips code-named Temash and Kabini, also in the first half this year. AMD showed Temash in a Windows 8 tablet at the CES earlier this month. Temash is targeted at tablets priced between $499 and $599. However, this is too little too late and is more or less just planting a flag in the market.

AMD’s custom chips are used in Nintendo’s Wii U gaming console, and other chips are expected to be in gaming consoles coming later this year.

AMD expects the custom and embedded businesses to constitute 20 percent of revenue by the fourth quarter, Read said, adding that the business could deliver as much as half of AMD’s revenue in the coming years.

Either way the, AMD is doing what sensible companies should be doing in a recession. That means hunkering down, restructuring, trimming fat and putting yourself into hibernation until things get better. It is more conservative, and less exciting, but will probably serve AMD well. 

Samsung riding high on Galaxy wave

Samsung is riding high on its Galaxy smartphones, outpacing Apple when it comes to handset sales.

According to Reuters, the company is projecting a quarterly profit for October- December 2012 of $8.3 billion.

The 89 percent jump from the same time last year is claimed to be driven by sales of the company’s Galaxy smartphones, which are being snapped up by around 500 people every minute.

The money is also coming in from its flat screen productions, which are found in its own mobile devices, as well as for Apple’s products, while the company’s chip prices have also improved from last year, driving share prices to record levels.

The company’s Galaxy Note II ‘phablet’ also allegedly outpaced Apple’s iPhones.

Samsung released 37 products last year – some of which were similar devices tweaked to suit regional preferences – compared to Apple, which focused on just one new smartphone, and HTC, which rolled out 18 devices and saw sales fall by 90 percent earlier this week.

In comparison to Samsung’s offerings, Nokia released nine similar products, while LG managed 24 devices.

Analysts claim that there are concerns the business’s buzz could slow down as a result of advanced markets coming close to saturation. This quarter is also predicted to be quieter for the company as a result of it not releasing any products until March/April, where it will roll out its Galaxy S IV, which is claimed to have an unbreakable screen and a better processor.

This new device should help boost the company’s sales within the second quarter, while its predicted smartphone sales, which analysts predict will rise by a third this year, could ensure it trumps Apple.

Neil Mawston, executive director at market researcher Strategy Analytics, told Reuters that he believed Samsung would sell 290 million smartphones this year, a leap from the projected 215 million in 2012.

Kim Sung-in, an analyst at Kiwoom Securities,went one further, predicting that the company could reach as much as 320 million smartphone shipsments this year, while its tablets could double in sales to 32 million.