iPhone’s Competitors: Que Pasa?

In my earlier posts, I have written on the exclusive carrier of iPhone, AT&T and its rivals Verizon, Sprint Nextel, and T-Mobile. This post will look at these companies wrt each other and the impact of iPhone on their business after a full quarter of iPhone sales. >>>

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Nokia’s 28% Sales Growth Underscores Strong Execution

In this post, I will look at recent developments in Nokia and Motorola. Earlier posts were featured in the iPhone series are available here and here. For the record, I own Nokia in my portfolio, as part of my convergence device bet along with RIMM, which I just bought as well. >>>

Good Time to Buy SanDisk

On August 31, just around the time I wrote my last post on Sandisk, it announced the introduction of Memory Stick Micro (M2) flash memory cards that would be mainly used in Sony Ericsson mobiles. The price is $149.99 for 8Gb and $99.99 for 4Gb.

On October 18, SanDisk (NASDAQ:SNDK) released its third quarter earnings. Revenue for the quarter increased 38% y-o-y to $1.037 billion. GAAP net income was $85 million, or $0.36 per diluted share, down 17% y-o-y and up 203% sequentially. Product revenue was $919 million, up 36% y-o-y and 28% sequentially. License and royalty revenue was $119 million, up 52% y-o-y and 11% sequentially. >>>

Samsung’s Convergence Device Prospects Remain Strong

I recently covered Samsung, a major vendor of iPhone’s components which also has the manufacturing and design capabilities to become the iPhone’s major competitor in the future. This post will take a look at the company since its earnings release on 12 October.

For the third quarter ending Sept. 30, 2007, Samsung reported revenues of 16.68 trillion won or $18.16 billion, a y-o-y increase of 9.6% and a sequential increase of 14%. Net income was 2.19 trillion won or $2.38 billion, up 1% y-o-y and 54% sequential increase after three consecutive quarters of losses.

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Convergence Device: Nokia Aligns with ST, Motorola with Infineon

Following my posts on Texas Instruments, STMicro, ARM, Infineon in the iPhone and the Future series as well as the iPhone’s Component Ecosystem series, here is an update on the companies.

Texas Instruments Incorporated (NYSE: TXN) reported revenues of $3.66 billion for the third-quarter 2007 on 22 October, up 7% sequentially and down 3% y-o-y. Increased demand for analog semiconductor products and back-to-school demand for graphing calculators led to the sequential growth. EPS was $0.52, an increase of 24% sequentially and 16% y-o-y.

Revenue in the Semiconductor segment was $3.46 billion (up 6% q-o-q and down 3% y-o-y). Within the semiconductor segment, sequential increase was 10% in analog and 6% in DSP revenue. Revenue in the Education Technology segment was $202 million.

In the third quarter, TI repurchased $1.4 billion of its stock. In September, its Board authorized an additional $5 billion in repurchases. For the fourth quarter, TI expects revenue to be in the range $3.40 to $3.68 billion and EPS to be in between $0.48 and $0.54.

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Apple’s Momentum Will Continue

I have written extensively on the iPhone. You can find them under the iPhone and the Future series as well as the iPhone’s Component Ecosystem series. My last post on Apple (NASDAQ: AAPL) was just a month after the release of iPhone. A month or so later on September 5, it announced a $200 reduction in the price of the 8GB model. The 4GB model has been discontinued. For its early iPhone customers, it is offering a $100 store credit for buying Apple products at its stores. The announcement was met with mixed reactions.

Soon after on September 10, it reached the milestone of 1 million iPhone sales. It started selling iPhones in UK and Germany on November 9, partnering with O2 in the U.K. and with T-Mobile in Germany. It will start selling the iPhones in France from November 29th, partnering with Orange. [I have covered the iPhone’s impact on the US carriers in some detail before.] >>>

Intel Aligned With Multiple Trends

Here’s an update on Intel since my last posts on the company, available here, here (discussion of Intel’s opportunity in the Convergence Device segment) and here (discussion of the multi-core issues).

Intel (INTC) recently announced its results for the third-quarter of fiscal 2007 in October. It reported a 15% y-o-y and 16% sequential increase in revenue to $10.1 billion. Net income was $1.9 billion and EPS was 31 cents. Operating income increased 66% sequentially from $1.35 billion in Q2 to $2.2 billion. Gross margin in the quarter increased from 46.9 % in Q2 to 52.4%, driven mainly by higher microprocessor volumes, lower 45nm start-up costs and lower microprocessor unit costs. >>>

ADP Can Become a Powerhouse Through Acquisitions

In a recent post, I covered Paychex. This post will look at its largest competitor, ADP.

Automatic Data Processing, Inc. (NYSE: ADP), with nearly $8 billion in revenues, 46,000 employees, and around 585,000 clients in fiscal 2007, is one of the world’s largest providers of business process outsourcing solutions. ADP offers a wide range of HR, payroll, tax and benefits administration solutions to companies of all types and sizes. ADP is also a leading provider of integrated computing solutions to auto, truck, motorcycle, marine and recreational vehicle dealers. Its business is organized into three segments: Employer Services, Professional Employer Organization (PEO) Services and Dealer Services. >>>

Palm, RIM and the Red Hot Smartphone market

Both Palm and RIM released their earnings in early October. Here is a look on their results and latest developments since my last set of posts on these companies.

Palm (Nasdaq:PALM) reported total revenue of $360.8 million in the first quarter of fiscal year 2008, up 1% y-o-y. Net loss was $0.8 million, or $0.01 per diluted share compared to net income for Q1 2007 of $16.5 million, or $0.16 per diluted share. Gross margin decreased to 36.3% compared with 37.1% in the year-ago period and 38.3% sequentially.

Smartphone sell-through was 689,000 units, up 21% y-o-y. Revenue from smartphones was $302.2 million, a y-o-y increase of 12% which was offset by 33% decline in the handheld business. For the quarter, revenue mix was 84% Smartphones and 16% handhelds.

In September, it launched Palm Treo 500v with Vodafone and the Palm Centro with Sprint. The Centro, which offers enhanced web and media applications and support for 3G for just $99 has got rave reviews. Based on the Palm OS, it could be a step in the right direction to meet its turnaround challenges as discussed at length in my recently concluded interview with departing Chairman Eric Benhamou. >>>

SAP Aggressively Going After SaaS, SME, Business Users

SAP (NYSE:SAP) reported its earnings on October 18 for the third quarter of fiscal 2007. Its revenues were €2.42 billion up 9% y-o-y. Net income was €408 million, a y-o-y increase of 10% over €370 million last year. EPS was €0.34, up 13% from €0.30 in Q3 2006. Software and software related service revenues were €1.74 billion, an increase of 13% over €1.54 billion in Q3 2006. Pure Software revenues were €715 million, up 11% y-o-y.

As per the earnings call, SAP has reiterated that its growth strategy is to continue to grow faster than the market by expanding its addressable market. It expects stable growth from its traditional businesses of horizontal and vertical applications, and accelerated growth from the SME and business user segments of the business process platform. The Business Users, by the way, is an untapped base that SAP really wants to penetrate, to raise its adoption and usage in the enterprise customers. >>>