Posted 11/20/09 at 07:24:09 AM by Paul Lilly

Dell didn't deliver in the third quarter the way analysts were expecting, instead missing the mark even on modest expectations, Businessweek reports.

According to the OEM's earnings report, sales dropped 15 percent to $12.9 billion. Net income took a bigger hit and fell by 54 percent to $337 million, or 23 cents per share, well below Wall Street's prediction that Dell would earn 28 cents per share on sales of $13.1 billion.

The poor performance affected just about every aspect of Dell's businesses, but sales to large businesses were hit particularly hard. That's bad news when close to 80 percent of Dell's sales are businesses and government customers.

Even the launch of Windows 7 didn't do much to bolster sales, at least not yet. According to company CFO Brian Gladden, customers had put off purchasing a PC in the weeks leading up to Windows 7, and Dell's quarter ended just eight days after launch.

"We built a bit of a backlog as a result, and we'll ship through that in the fourth quarter," Gladden said.

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Posted 11/10/09 at 07:21:26 PM by Ryan Whitwam

Things aren’t looking great for AOL as it is in the process of shaking Time Warner loose. The once dominant internet company has announced that 100 layoffs will be happening soon. After that AOL plans to ask for voluntary departures, possibly with some sort of buyout system. If that doesn’t produce the desired results, employees can expect heads to roll.

In an earnings call last week, Time Warner reported that AOL revenues were down 23 percent from last year. Sources say that those figures mean AOL will need to cut about 1000 jobs through various means. The larger layoffs could coincide with AOL’s departure from Time Warner. It will be a rough holiday season for some AOL employees. It almost makes you miss the golden age of the free AOL disk.

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Posted 11/10/09 at 07:06:45 AM by Paul Lilly

According to market research firm Gartner, worldwide software as a service (SaaS) revenue is on pace to reach $7.5 billion in 2009. That's a big turnaround from 2008 -- 17.7 percent, to be exact -- when revenue fell flat at $6.4 billion.

"The adoption of SaaS continues to grow and evolve within the enterprise application markets," said Sharon Mertz, research director at Gartner. "The composition of the worldwide SaaS landscape is evolving as vendors continue to extend regionally, increase penetration within existing accounts and ‘greenfield’ opportunities, and offer more-vertical-specific solutions as part of their service portfolio or through partners."

But that's not the only good news. Gartner says the market will show consistent growth at least through 2013, by which time SaaS revenue is expected to exceed $14 billion in the enterprise sector.

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Posted 11/09/09 at 03:58:54 PM by Pulkit Chandna

The PC processor market seems to be on a comeback trail. According to a fresh report by IDC, CPU shipments in the third quarter of 2009 increased 23 percent from the previous quarter, which is a new record for sequential growth. The increase in shipments was accompanied by a 14 percent sequential increase in revenue. The sales of PC processors in the quarter helped generate $7.4 billion in revenue.

Mobile CPU shipments grew 35.7 percent in 3Q09 to bail the industry out from what is now a receding crisis. The Intel Atom processor merits a special mention as it led the industry's comeback during the quarter. But the low average selling price of Atom processors meant that the record growth in shipments did not quite translate into record revenue.

"While Atom processors led the PC processor market to reach record unit shipments, on the revenue side, their low average selling price led to notable price erosion, more than 7 percent." said Shane Rau, director of semiconductors for personal computing research at IDC.

"The market's growth has been due to shipments of inexpensive Atom processors being sold into markets like China, which is being stimulated by government incentives there," said Rau.

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Posted 11/06/09 at 10:57:53 AM by Paul Lilly

Around this time last year, the topic of Nvidia included faulty GPUs, which ultimately ended up costing the firm millions of dollars, and stiff competition from a suddenly revitalized ATI. Now it's all about Nvidia's upcoming Fermi graphics and revenue gains.

Ending the third quarter on a positive note, Nvidia reported revenue of $903.2 million. Nvidia CEO Jen-Hsun Huang said that marks an increase of 16 percent over the previous quarter, and is slightly up from this same time last year when the graphics chip maker posted revenue of $897.7 million.

"We continued to make progress in the third quarter with healthy market demand across the board," said Jen-Hsun. "Revenue was up from a year ago, with improvement in each of our PC, professional solutions, and consumer businesses. It's great to see us shipping orders with our Tegra mobile-computing solution, and growing enthusiasm for our Tesla platform for parallel computing in the server and cloud-computing markets."

 Nvidia CFO David White added that the company's GPU business was up almost 25 percent sequentially.

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Posted 11/05/09 at 07:57:09 AM by Paul Lilly

Maybe the economy is recoverying after all, or so analysts are saying after Cisco reported fiscal first-quarter earnings that nudged ahead of expectations and showed strong sequential growth.

The network security firm reported a quarterly profit of $1.8 billion, or 36 cents a share. That's down from last year, when Cisco posted a profit of $2.2 billion, or 42 cents a share, but up from last quarter. Revenue for the first fiscal quarter climbed to $9 billion, which is more than the $8.75 billion analysts had expected.

"Our ability to launch four proposed acquisitions, the ecosystem-shifting coalition with EMC/VMware, and five new products and industry solutions into the Cisco pipeline in the past few months alone underscore this momentum," said John Chambers, Chairman and CEO of Cisco. "Our build – buy - partner innovation engine is clearly running on all cylinders, while our operational machine is pulling costs out of the business even as we scale new models for growth. Execution and results over time will demonstrate the long-term impact of this vision and strategy— but a new model of productivity based on collaboration is clearly emerging and we believe this may be the most profound opportunity for businesses in our 25 years as a company."

Cisco has been on a spending spree as of late, having recently agreed to purchase Starent Networks for a cool $2.9 billion and ScanSafe for $183 million.

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Posted 10/28/09 at 02:04:11 PM by Paul Lilly

SAP, the multinational software development and consulting firm headquartered in Germany, reported a bigger-than-expected drop in third quarter revenue in its earnings announcement today.

Somewhat offsetting the disappointing performance were lower tax rates and better profit margins, both of which led to a 12 percent rise in net income. But this came as little consolation to investors, as SAP also reported a 31 percent decline in software revenue. SAP adjusted its sales forecast for 2009 and now expects revenue to drop anywhere from 6 to 8 percent.

SAP also caught fire from Oracle last month after Oracle reported weaker-than-expected sales of new software licenses, which Oracle blamed on SAP's weakness as a reseller of its products.

Putting a positive spin on the sobering numbers, SAP chief executive Leo Apotheker pointed out gains in his company's volume business and multi-year agreements.

"Despite the continued tough spending environment, we are pleased to see further progress in the evolution of our volume business as a result of smaller deals," Apotheker said. "In addition, we are driving more multi-year agreements, where customers buy and consume software over many periods, which we believe is a positive transition for both SAP and our customers."

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Posted 10/23/09 at 03:06:02 PM by Paul Lilly

Recession? Tech slump? Losses? Apparently these are all things Western Digital is not familiar with, even if just about everyone else in the tech industry is. The hard drive maker today reported record quarterly revenue of $2.2 billion, and that's not the only record that was set.

Hard drive shipments also hit a record high totaling 44.1 million units for the quarter. All tallied, Western Digital pulled in net income of $288 million, or $1.25 per share, for its first fiscal quarter ended October 2, 2009.

"For the second consecutive quarter, demand for hard drives was stronger than expected as the positive industry conditions that materialized in the June quarter continued throughout the September quarter," said John Coyne, president and chief executive office. "We believe that demand is being driven primarily by consumers as a result of the growing social media phenomenon. This is creating demand in mobile and desktop PCs, branded products, and enterprise storage."

Western Digital went on to say that its hard drive inventories remain at historically low levels. And going forward, the hard drive maker says demand remains strong, so the good times should continue.

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