From Briefing.com: 4:27PM Xilinx reports EPS in-line, beats on revs; guides Q4 revs below consensus (XLNX) 15.50 -0.73 : Reports Q3 (Dec) earnings of $0.32 per share, excluding $0.19 in non-recurring items (or excl $89.7 mln in gains and $18.5 mln in charges), in-line with the First Call consensus of $0.32; revenues fell 3.5% year/year to $458.4 mln vs the $443.7 mln consensus. Xilinx sees Q4 revs down 15-25% sequentially. Co issues downside guidance for Q4, sees Q4 revs down 15-25% sequentially, which equates to ~$343.8-389.6 mln vs. $409.65 mln consensus. Operating expenses are expected to be flat to slightly down sequentially from the December quarter.
4:51PM Motorola announces further 2009 cost reduction actions and sees Q4 revs below consensus (MOT) 4.11 -0.21 : Co issues guidance for Q4 (Dec), sees GAAP EPS loss of $0.07-0.08 including charges of ~$0.06, may not be comparable to $0.03 First Call consensus; sees Q4 (Dec) revs of $7.0-7.2 bln vs. $7.51 bln consensus. During Q4, Mobile Devices shipped ~19 mln units. Sales were adversely impacted by continued weakness in end consumer demand and customer inventory reductions. The Enterprise Mobility Solutions and Home and Networks Mobility businesses continued to perform very well in a challenging environment... Co announces further cost reduction actions, primarily associated with the Mobile Devices business. Co will further reduce its workforce in 2009 by ~4,000 positions. The workforce reductions announced are expected to begin immediately and are incremental to the 3,000 workforce reduction actions previously announced during the fourth quarter of 2008. The workforce reductions, plus other incremental cost-reduction initiatives are expected to result in additional annual cost savings of ~$700 mln in 2009. The savings from these actions, together with the $800 mln of savings from other actions announced during the fourth quarter of 2008 are expected to result in aggregate cost savings of $1.5 bln in 2009...
4:46PM Apple to resume trading at 17:00 ET (AAPL) 85.33 -2.38 : Quote resumption to begin at 16:55 ET.
4:36PM Apple CEO Jobs announces medical leave of absence until the end of June (AAPL) 85.33 -2.38 : Apple CEO Steve Jobs today sent the following email to all Apple employees: "Team, I am sure all of you saw my letter last week sharing something very personal with the Apple community. Unfortunately, the curiosity over my personal health continues to be a distraction not only for me and my family, but everyone else at Apple as well. In addition, during the past week I have learned that my health-related issues are more complex than I originally thought. In order to take myself out of the limelight and focus on my health, and to allow everyone at Apple to focus on delivering extraordinary products, I have decided to take a medical leave of absence until the end of June. I have asked Tim Cook to be responsible for Apple's day to day operations, and I know he and the rest of the executive management team will do a great job. As CEO, I plan to remain involved in major strategic decisions while I am out. Our board of directors fully supports this plan." (Stock is halted)
4:36PM PC market growth evaporates in Q4 as financial crisis hits home, according to IDC : Despite market optimism early in the fourth quarter, the pace at which the economic environment unraveled and the extent to which PC purchases were affected was faster than anticipated. Following roughly six years of growth, with the last five averaging 15% increases, worldwide PC shipments were down 0.4% year on year in the fourth quarter of 2008, according to IDC's Worldwide Quarterly PC Tracker. The dramatic slowdown was enough for a sequential decline of 2.5% from the third quarter in place of an expected increase for the holiday season. The weakening economic environment, including falling home and stock values, deteriorating credit, and implications for trade and consumer spending, was clearly the dominant factor limiting growth. Low-cost portables, vendor competition, and holiday promotions were simply not enough to overcome the economic tide, even with the market for mini notebooks (also known as netbooks) taking off. Growth of portable PCs was cut roughly in half from nearly 40% year on year in the first three quarters of 2008 to roughly 20% in the fourth quarter. Meanwhile, the pressure on desktop PCs pushed volume down roughly 16% from a year ago after only a small decline earlier in the year. Mini notebook volume is estimated at near 5 million units in the fourth quarter, bringing the total for 2008 to about 10 million, accounting for nearly 7% of total portables, with shipments expected to double in 2009. Despite the dramatic slowdown in fourth quarter shipments, annual volume was up 10.5% in 2008. This was on par with 2006, when some vendors struggled with the accelerating transition to portables and replacement rates dropped with economic uncertainty and the pending launch of Vista.
4:00PM SMSC announces cost reduction actions, including worldwide personnel reduction of 5-10% (SMSC) 14.41 -0.39 : Co announces a reduction in worldwide personnel of 5-10%, including a voluntary retirement incentive for most employees 55 years of age and older. SMSC is also planning or has already implemented a series of additional cost reduction actions including: Discretionary spend reductions, including travel, recruitment fees, consultants, temporary employees and other services; Reduction of compensation expenses including deferral of merit increases and adjustments to the management bonus plan; Restricted capital spending; Strict management of working capital, including an inventory reduction program with extended test floor shutdowns and reduced material purchases. The company estimates that these actions will result in a reduction of its expenses of approx $6-$7 mln a qtr compared to the third qtr of fiscal 2009 run-rate.
12:22PM Wavecom: Sierra Wireless announces opening of cash tender offers to acquire Wavecom in friendly deal (WVCM) 11.14 +0.19 : Sierra Wireless (SWIR and Wavecom (WVCM) announce the commencement of cash tender offers in France and the United States, by Sierra Wireless France SAS, a wholly owned subsidiary of Sierra Wireless, for all outstanding shares (including shares represented by American Depository Shares and OCEANE convertible bonds of Wavecom. The offer price for the ordinary shares is (euro) 8.50 per share and the offer price for the ADSs is the U.S. dollar equivalent of (euro) 8.50, based on the Euro/U.S. dollar exchange rate as of the settlement date for ADSs. The offer price for the OCEANE convertible bonds is (euro) 31.93 per bond plus unpaid accrued interest up to and including the date of settlement.
9:51AM Flextronics provides business update following Nortel announcement (FLEX) 2.81 -0.19 : Co provides a business update as a result of Nortel Networks (NT) bankruptcy protection filing. Co has been proactively engaged in executing a risk mitigation plan with respect to its relationship with Nortel for a period of several months. In December 2008, Flextronics engaged The Blackstone Group as its financial advisor to assist with evaluating the Nortel relationship and planning for any Nortel restructuring strategy. As part of its risk mitigation plan, Flextronics entered into an amendment to its relationship agreement with Nortel to address Flextronics's status as a strategic supplier... Co will provide more specific financial details associated with today's news on its previously scheduled third quarter earnings call on January 28, 2009.
09:44 am Advanced Micro initiated with a Sell at Auriga U.S.A; tgt $1.25: . Auriga U.S.A. initiates AMD with a Sell and $1.25 tgt, saying a solid commitment from financial backers with long-term motivations means that a failure of the firm is no longer a likely scenario. However, the planned split into separate manufacturing and design entities doesn't improve the underlying cash burn rate. They think continued deterioration of the PC market combined with limited exposure to the high-growth mobility segment mean that earnings will likely continue to suffer. This raises the possibility that yet more financing will be required -- there are willing cash providers, but existing shareholders run the risk of being diluted even further.
09:43 am Seagate Tech downgraded to Hold at Argus: . Argus downgrades STX to Hold from Buy. The firm notes that the stock recently dropped to all-time lows as the hard-disk drive business is getting hammered by the combination of deteriorating end-user demand in the PC space with increasing competition from solid-state drives. Furthermore, recent management shifts suggest a change in company course is in the offing. The question is which way STX will go. Possibilities include acquiring an outside company in order to shift rapidly away from its focus on HDDs to a new storage medium; being acquired itself; more rapidly moving into the solid-state game; or returning to being a private firm. With all of these options on the table and the stock's dividend now in question, the firm believes investors are better off staying on the sidelines at this time.
09:38 am Suntech Power downgraded to Neutral at Amtech- tgt $7: . Amtech downgrades STP to Neutral from Buy with an $7 tgt following a strong move off of the November lows, and ahead of what they expect will be a difficult solar earnings season defined by limited visibility into 1H09. The firm says checks indicate utilization rates for 1Q09 are expected to be in the 50-60% range. The firm does not view significant 1Q09 Q/Q revenue growth as likely given utilization rates and pricing pressure.
09:36 am Nortel Networks (NT)
Nortel Networks (NT 0.07, -0.25) filed for Chapter 11 bankruptcy protection Wednesday.
Nortel has been hurt by a steep drop in orders from phone company clients. The company also faced a $107 million bond interest payment this week and owes bondholders more than $3.8 billion according to court filings.
Nortel said its normal day-to-day operations are expected to continue without interruption.
08:26 am Citigroup (C)
As expected, Citigroup (C 5.90) said after Tuesday's close that it will merge its Smith Barney brokerage with Morgan Stanley's (MS 18.86) Global Wealth Management Group.
The new unit will be called Morgan Stanley Smith Barney and will have more than 20,000 advisors managing more than $1.7 trillion in client assets.
Under the terms of the agreement, Citi will exchange 100% of its Smith Barney, Smith Barney Australia and Quilter units for a 49% stake in the joint venture and an upfront cash payment of $2.7 billion. Morgan Stanley will exchange 100% of its Global Wealth Management business for a 51% stake in the joint venture.
Citigroup will recognize a pretax gain of $9.5 billion, or approximately $5.8 billion on an after-tax basis.
Many analysts feel that this is the first step in the breakup of Citigroup, as it looks to streamline operations and abandon its "financial-services supermarket" model. |
