Financials – Page 3 – Digital-Lifestyles

Amazon Revenue Rockets, Income Slips

Amazon Revenue Rockets, Income Slips Amazon.com’s revenue soared internationally in the second quarter as electronics and other non-book bits’n’bobs made up more of its business.

The cash tills rang loud to the tune of US$1.75 billion (~£1bn, ~€1.45bn) in the quarter ended June 30, up a healthy 26 per cent from US$1.39 billion in last year’s second quarter.

Amazon’s international segment – which includes its UK French, German, Japanese and Chinese units – climbed 33 per cent from last year to reach US$793 million (~£456m, ~€661m).

The behemoth of online book floggers saw its sales of electronics and general merchandise grow to 26 per cent of its worldwide sales from 23 per cent a year earlier.

Amazon Revenue Rockets, Income Slips Amazon.com’s chief financial officer, Tom Szkutak, announced that third-party sales accounted for 28 percent of Amazon.com’s total items sold, sprightly stepping up from 24 percent for this time last year.

Szkutak said that the company was chuffed with the “heavy shopping” undertaken by Amazon Prime customers who have been clicking madly for electronics, tools, kitchen supplies, and health and personal care products.

“Though expensive for the company, Amazon Prime creates a premium experience for customers who join, and as a result we hope they’ll purchase more from us in the long term,” Szkutak said.

It wasn’t all pearly-white grins, as Amazon announced that net income declined to US$52 million (~£30m, ~€43m) from US$76 (~£44m, ~€66.3m) million in the second quarter of 2004.

Amazon Revenue Rockets, Income Slips This includes US$56 million (~£32.25m, ~€46.6m) in income tax expense, which was up from US$5 million (~£2.87m, ~€4.16m) a year earlier.

Amazon’s earnings were US$0.12 per share, slipping down from US$0.18 per share in last year’s second quarter, but still ahead of analyst’s predications.

Amazon said it expects sales to increase of 20 percent to 31 percent in the current quarter compared to last year.

Amazon

Google Profits Rocket Another 300%

Google Profits Rocket 300 Per Cent Champagne corks were firing off at Google like a military salute as the Internet search engine kings revealed that their profits had jumped more than 300 per cent in the second quarter this year.

Fuelled by continued growth in Web advertising, Google raked in a revenue of $1.38 billion (~£788m ~€1.13bn) its second 2005 fiscal quarter, up 98 per cent compared with the same period last year.

Once you take off the $494 million (~£282m ~€406m) paid by Google to its ad network partners (known as traffic acquisition costs), revenue racked up to a wallet-delighting $886 million (~£506m ~€728m).

Net income came in at $343 million (~£195m ~€282m), favourably comparing with the $79 million (~£45m ~€64m) recorded in 2004’s second quarter, while revenue from Google sites totted up to $737 million (~£421m ~€606m) – up a thumping great 115 per cent.

Revenue from Google ad network partners was similarly rosy, totalling $630 million (~£359m ~€518m), an increase of 82 per cent.

“We are very proud of our results. Business is very good here at Google,” said chief executive Eric Schmidt, dodging the flying champagne corks. “It’s really because we’ve figured out ways to stay focused on end users and innovation.”

Although the vast majority of Google’s revenue comes from paid advertisements on search results pages and on partner sites, the company has been diversifying with new products and services like video search and mapping.

Google Profits Rocket 300 Per Cent The company’s fortunes are currently on a stratospheric trajectory, with April’s first-quarter profit almost six times higher than a year earlier.

Not surprisingly, Google’s share price has soared, nudging above $300 (~£171 ~€246) a share for the first time last month and giving the company the honour of being the world’s biggest media group by stock market value.

Recent figures from Nielsen/NetRatings revealed that Google has attracted in excess of 78.5 million US visitors last month, up 25 per cent from a year ago, with the Google and Blogger brands ranked numbero uno in search and Web hosting, respectively.

Meanwhile, Yahoo had to make do with cheapo Cava as figures posted on Tuesday revealed a higher second-quarter profit but with revenue falling short of analyst expectations.

This news sent Yahoo! shares tumbling down as much as 10 per cent in after-hours trading.

Google

Vodafone Rakes in Record Revenues

Vodafone Rakes in Record Revenues Vodafone execs spent the morning cackling wildly to themselves, throwing wads of dollar bills in the air and rolling around silk-covered beds covered in cash as record revenues and profits for its full year results were announced to the world.

The mobile operator – the world’s numero uno by revenue – has raked in eye-wateringly large pre-tax profits of £13bn, before write-downs.

With revenues increasing 4.3 per cent year-on-year to £34.1bn, these are champagne cork-launching record figures for a UK company.

Vodafone’s subscriber base rose by 16.3 million to 154.8 million, and the company have announced that it will buy back £4.5bn worth of its own shares, and double its dividend payment to 4.07p.

“We have met or exceeded all of our stated targets and significantly increased returns to shareholders,” purred chief exec Arun Sarin, sounding like the cat who got the cream, the milk float and the dairy that made it.

Vodafone Rakes in Record Revenues But in-between triumphant licks of triple-thick Cornish clotted cream, Sarin sounded a cautious note, warning that competition was rising.

“Whilst competitive pressures are increasing, there is clear evidence that our global scale and scope is enabling us to deliver innovative customer propositions and to produce superior results,” he puffed.

The company have experienced organic customer growth of 12 per cent globally, with Vodafone live! active devices increasing to 30.9 million and adoption of 3G services rising to 2.4 million devices at the year end.

“Here in Europe, we are leading the parade on 3G,” Sarin air-punched.

Vodafone Rakes in Record Revenues Vodafone performed particularly well in strong markets such as the US and Spain, with revenues growing at more than 20% year on year.

The company also kicked ass in its core European markets, with Italy, Germany and the UK doing especially well, despite fierce competition.

Vodafone didn’t get it all their own way though, with disappointing figures from Japan prompting a business improvement plan in the year ahead (the company currently lags in third place with around 16 per cent market share behind NTT DoCoMo and KDDI.).

Vodafone
Vodafone Group Fiscal Year Pretax, Pre-Items Profit GBP10.3 Billion

WiFi Kit Revenues Hit Record Levels: Infonetics Research

WiFi Revenue Hits Record Volumes Despite prices being pushed downwards by fierce price competition, worldwide wireless LAN equipment revenue rose 20% to US$767.6 million (~£420m ~€610m) between the fourth quarter of 2004 and the first quarter of 2005.

During that period, a grand total of 12.2 million units were shipped, the highest quarterly volume to date, according to a report from Infonetics Research.

With wireless LAN products continuing to grow in popularity across product categories and geographic regions, revenue is expected to rise another 2% to $779.6 million (£426m, €620m) by 1Q06, hitting $3.6 billion (~£173m~€251m) by 2008.

Wireless LAN switch ports have been shifting faster than a Ritalin-assisted rabbit, rising 44% to 112,000 as revenue grew 13% to $52.2 million (~£285m~€41.53m), with a leap to $699.2 million (~£381~€556) predicted for 2008.

As the world goes bonkers for broadband, the demand for wireless broadband routers has soared accordingly, registering a hefty 34% increase in revenue between 4Q04 and 1Q05 generating $328 million (~£173.8m~€253m).

WiFi Revenue Hits Record Volumes That’s a thumping great 37% increase in unit shipments, representing not-to-be-scoffed-at sales of 6 million.

Naturally, the manufacturers want to keep the cash flowing in their direction, so have been busily slapping on new product features to generate replacement purchasing.

“The demand for wireless broadband routers continues unabated, driven by the possibilities of wireless home networking,” said Richard Webb, lead analyst of the Infonetics report.

“As more and more users explore the possibilities of media download and file sharing applications they are finding that this easy-to-use device uncovers the true potential of their broadband connection. And with 802.11n and even faster throughput speeds on the horizon, the wireless router segment will ride the crest of the global broadband wave.”

Cisco continues as the worldwide wireless LAN revenue leader, hogging 17% of the market share following four consecutive $100-million-plus (~£53.7m~€79.5m) quarters.

WiFi Revenue Hits Record Volumes D-Link barged ahead of Cisco-Linksys to grab second place, with NETGEAR in fourth position.

Just in case you, dear reader, haven’t had quite enough facts yet, allow me to inform you that the report revealed that access points account for 71% of wireless LAN equipment revenue, NICs account for 13%, and infrastructure products, including wireless LAN switches, appliances, controllers, and mesh networking gear, account for 16%

SOHOs and consumers make up just over half of wireless LAN equipment revenue (51%), down from 53% in 4Q04 while service providers and enterprises make up the rest.

Finally, a little geographic fact flurry to end with: North America accounts for 45% of wireless LAN equipment revenue; Europe, Middle East and Africa for 30%, Asia Pacific for 21%, and Central America / Latin America for 4%.

So now you know.

WiFi Hit Record Volume in 1Q05; Revenue Up 20%

3G boosts Ericsson’s profits

Ericsson's profits boosted by 3G rollout Ericsson has reported a thumping great rise in quarterly profits, helped by the deployment of 3G networks.

The Swedish telecommunications equipment giant reported better than expected first quarter profits of 6.7 billion kronor (£499 million), compared with 3.7 billion kronor last year.

Ericsson, the world’s largest supplier of mobile phone networks, said that net income for the first quarter increased 73 percent to 4.64 billion kronor (US$661 million) from a year earlier.

Sales were up 12 percent at 31.5 billion kronor, buoyed by the roll out of 3G services in Western Europe and increased demand for WCDMA, a high-speed transmission technology, in Eastern Europe and Turkey.

The company also saw solid demand in emerging markets with a substantial rise in sales expected in China in the second quarter.

Ericsson's profits boosted by 3G rollout These figures fly in the face of predictions from investors and analysts that sales would drop steadily for the big telecoms firms as Chinese manufacturers took over the industry.

Robert Sellar, head of technology on the equities desk of Aberdeen Asset Management, commented that these predictions failed to take into account the amount of spending that these companies’ customers needed to do to improve their existing networks to support 3G and other new technologies.

Ericsson’s orgy of champagne popping was, however, slightly marred by the news of unexpectedly strong reports from arch rivals Nokia and Motorola.

Ericsson
Ericsson First Quarter report
Nokia’s Quarterly Profit Increases By 18 Percent
Motorola Announces Record First-Quarter Sales and Earnings

Google Profits Up Fivefold

Google Profits Up Fivefold Champagne corks were popping like manic machine gun fire at Google yesterday as the company reported a thumping fivefold increase in profits in the first quarter.

The Californian search giant purred loudly as it revealed that net income for the quarter ended 31 March, based on generally accepted accounting principles, was $369 million (£193/€282m) or $1.29 (£0.67/€0.98) a share, compared with a measly $64 million (£33.5m/€49m) or 24 cents a share, for the same period a year ago.

Naked execs excitedly rolled around in beds covered in dollar notes* as revenues for the quarter racked up to $1.26 billion (£0.65bn/€0.96bn), a massive 93 percent increase from the previous year.

“This was a very strong quarter for Google,” revelled Eric Schmidt, chief executive for Google, “We continue to execute well and we have been able to take full advantage of the growth in online advertising.”

Internet advertising revenue as a whole is becoming a large, well-fed cash cow, increasing by 32 percent last year to just under $9.6 billion (£5.02bn/€7.34bn), compared with $7.3 billion (£3.81m/€5.58m) in 2003, according to the Interactive Advertising Bureau.

Google’s own sites, which rely heavily on paid search results and on users clicking on ads, brought home $657 million (£343.6m/€501.7m) – 52 percent of the company’s total revenues and a 116 percent increase over the same quarter a year ago.

Google Profits Up Fivefold Revenues generated from Google’s partner sites through its AdSense programs generated $584 million, or 47 percent of revenues, – a hefty 75 percent increase over partner-related revenues a year ago.

They’ve also been bulk-buying new desks and chairs and introducing crowd control around the water cooler at Google, with the company hiring another 461 employees since the end of the fourth quarter last year, bringing the total up to 3,482 full-time employees.

(*we may be exaggerating slightly here)

Google

BookSurge, Print-On-Demand Book Company, Signs With Amazon

Print-On-Demand Book Company Signs With Amazon Online retail giant Amazon.com has scooped up the ‘printing fulfillment’ company BookSurge, which maintains a catalogue of thousands of book titles available for users to print on demand.

“Print-on-demand has changed the economics of small-quantity printing, making it possible for books with low and uncertain demand to be profitably produced,” Greg Greeley, vice president of media products for Amazon.com, said in a written statement.

The move seems to reflect Amazon’s continued efforts to add new revenue streams and fight off competition from online rivals such as eBay and Overstock.com. Amazon has already been forced to lower prices to keep customers wandering off elsewhere.

Despite generating twice the revenue of its main rival eBay, Amazon is lumbered with the hefty financial drain of maintaining and operating its warehouses throughout the world – because eBay sells a service not a product, it manages to be three times more profitable than Amazon with only half its revenue.

Amazon’s deal with BookSurge gives the company the ability to offer a new product without adding any further burden on distribution network.

Print-On-Demand Book Company Signs With Amazon The company will now offer (cue: North American accent) “inventory-free book fulfillment” to publishers through BookSurge Publisher Services and to authors through BookSurge Publishing.

Print-on-demand allows booksellers to offer titles with limited appeal, without the hassle of having to keep stock which may not get sold.

Additionally, retailers, wholesalers and distributors will be able to leverage the BookSurge Direct wholesale platform.

“BookSurge makes it possible to print books that appeal to targeted audiences, whether it’s one copy or one thousand,” Greeley said. “Our new relationship with BookSurge will provide Amazon customers an ever-expanding selection of titles that are not available through other channels. Thanks to print-on-demand, ‘out of print’ is out of date.”

This latest move continues Amazon.com’s trend toward the world of e-books and other downloadable products, building on its 2001 eBook deal with Adobe Systems that added nearly 2,000 e-books to its catalogue.

Although e-books are still a small part of the current online book market sector, significant growth is expected by publishing companies and online retailers.

Internet portal Yahoo already has an e-book sales deal with four major publishing houses and Amazon are clearly looking to get their size nines wedged into this door of opportunity.

Amazon
BookSurge

Apple Shares Fall As Sony And Napster Bite

Apple Shares Fall As Sony And Napster Bite Apple Computer shares dropped Tuesday as Sony relaunched its famous Walkman line amongst concerns that increased competition from Napster might impact its dominance of online music and portable players.

The soaraway success of the iPod music player has transformed Apple’s balance sheet and its stock price, with the company shining as one of the best performers in the Nasdaq technology index over the past year.

But some industry pundits are predicting that Apple is being damaged by serious competition from a new generation of smaller, sleeker and cheaper MP3 players from the likes of Sony, Rio and Creative and a host of online music services led by Napster.

Shares of Apple have dropped 8.5 percent since the announcement of the stock split on 11 February, and have fallen some 6 percent this week alone.

“Competition concerns are certainly going to influence how this stock trades,” said Warren West, principal at Philadelphia-based GreenTree Brokerage Services, which executes trades for institutional investors such as asset managers and hedge funds. “Investors in general have enjoyed the stock moves, there’s a lot of money that has been made, and people are going to start taking profits _ especially after the split.”

Apple Shares Fall As Sony And Napster Bite Over the last twelve months, Apple’s share price has gone from US$23 (€17/£12) to an all-time high of US$81.99 (€61/£42) just before the split was announced.

Investors must now decide if the company’s share price can maintain its strength in the face of a market getting becoming increasingly crowded with rival products.

Sony are aggressively targeting the iPod with their Walkman line of digital music players, hoping to woo customers with lightweight and compact flash memory players instead of bulkier, hard drive-based units.

In fact, many of the new iPod alternatives aren’t trying to compete with Apple’s player at the high end but are focussing on consumers who are choosing between cheaper, lower-storage-capacity flash-media players and pricier, entry-level hard-drive players that hold more than 1,000 songs.

The Sony flash-media players will be knocked out for as low as US$130 (€97/£68) – not as cheap as the new iPod Shuffle, but considered to be better value because of a longer battery life and more features.

“Flash is going to be here for a while, because it’s more affordable,” Kelly Davis, product manager for Sony Electronics, says. “People are trying to get more capacity for their dollar.

The new Sony players are expected to give the company the No. 2 position in the portable music player market by next year.

Apple’s iTunes service is also coming under attack, with rival Napster recently boosting its sales outlook with growing demand for its new “Napster To Go” subscription service, expected to generate US$15 million for its fiscal fourth quarter.

Apple is also experiencing competition from music services offered by rivals such as Microsoft Corp., Real Networks, and Yahoo.

The company still remains in good shape though, with Piper Jaffray analyst Gene Munster predicting continuing good sales for the iPod line.

“Our checks have left us more confident that demand for Apple’s key products most notably iMac, Powerbook, Mac mini and various versions of the iPod continue to be ahead of expectations,” Munster told clients in a research report. “We anticipate that strong demand across various segments of the company will allow Apple to exceed Wall Street estimates for overall revenue and earnings.”

Munster expects the company to report earnings of US$1.04 (€0.77 /£0.53) per share on revenue of US$12.81 billion in 2005, up from previous expectations of a 98% share profit on sales of US$12.25 billion.

Piper Jaffray told clients it expects Apple to sell 3.8 million iPods during the second quarter, including 1 million iPod shuffle models, followed by 4.6 million iPods during the third quarter, with the Shuffle model accounting for 1.8 million of the sales.

Apple Shares Fall on Sony, Napster Fears (PA)
Sony MP3 players
Apple iPod

Frontier Silicon Raises $28m For DAB And Mobile TV Chip Tech

Frontier Silicon, the British company that makes chips for mobile digital television and digital radio products, has completed it US$28 million (€21m/£14.5m) investment round funding.

Irish venture capital firm ACT led the US$28 million investment in Frontier Silicon, with other participants in the venture funding round being Apax Partners, AltaBerkeley Venture Partners, Quilvest and Bluerun Ventures (formerly known as Nokia Venture Partners).

Frontier Silicon has developed two new products, the Apollo chip and Kino chip, which allow mobile phones to receive and record television programmes on their mobile phones, electronic organisers or MP3 players.

Anthony Sethill, founder and chief executive of Frontier Silicon, said that the money raised would be used for product development and marketing purposes.

He boldly predicted that half of all mobile phones would be capable of receiving television programmes within a year or so at an additional cost to the user of under $50 (€37/£26).

Frontier Silicon currently employs 60 people between its English, Hong Kong and Chinese operations and boasted a turnover of more than $30 million (€22.7m/£15.6m) in 2004.

“This latest investment allows us to aggressively target and drive market share in the emerging mobile digital television market in the same way that we have established our chips in over 70 percent of DAB digital radios,” said Anthony Sethill.

Frontier Silicon produces chips for DAB digital radios, with its customers including such industry heavyweights as Bang & Olufsen, Grundig, Hitachi, Philips and Samsung.

The company also delivered the world’s first complete system-on-chip designs for DAB digital radio as well as the world’s first Combined Digital TV and Radio Chip.

Frontier Silicon

PacketVideo Ships on 17m Mobile Phones in 2004

PacketVideo Ships 17 Million Multimedia Handsets in 2004 In their 2005 “State of the Company” address just made public, PacketVideo bigged up their successes in 2004 and mulled about the future of mobile multimedia.

Clearly, 2004 was a time of happiness and joy for PacketVideo, with the company announcing that 17 million phones embedded with PacketVideo media software were shipped by top handset OEMs worldwide in 2004.

PacketVideo also helped launch five 2.5G and 3G multimedia services, including the recent Verizon V CAST video-on-demand (VOD) service in the US, and the OrangeWorld service on Orange Signature phones in 2004 and early 2005.

PacketVideo is the numero uno supplier of embedded multimedia communications software for mobile phones with more than 60 ‘design wins’ and 17 million handsets shipped in 2004.

The company’s software enables mobile phones to take digital pictures, record home movies, play back digital music and videos, and make two-way videophone calls.

PacketVideo Ships 17 Million Multimedia Handsets in 2004 PacketVideo specialises in building and ‘commercializing’ (we think that’s American for “selling”) multimedia capabilities such as VOD, music on demand (MOD) and two-way video communication and messaging.

“These much-anticipated multimedia services, made possible by the growing availability of 3G networks, are finally a reality for millions of people around the globe,” trumpeted Dr Jim Brailean, CEO of PacketVideo. He continued, “PacketVideo’s software is at the heart of delivering these new and innovative services that let customers download, play, and share streaming audio, video and live broadcasts on their mobile phones.”

Looking to the future, PacketVideo expects continued growth and technology innovation, and anticipates an increase in both lovely lolly and market share.

“We believe 2005 will be the year of multimedia services such as VOD, MOD (Movies On Demand) and two-way video telephony. We will see the multimedia technologies permeate all levels of handsets, allowing more and more consumers to take advantage of the multimedia capabilities,” enthused Brailean.

PacketVideo