Archive for the ‘financial results’ tag
Earnings & other news from the past week no comments
Last week there were several important financial reports and related news that I didn’t get a chance to write about.
Early in the week Apple reported its fiscal second quarter 2012 results and they were impressive – the company’s net profit increased 94% year over year as iPads and iPhones continue to sell like hotcakes around the world. Growth in the Asia-Pacific has been especially strong for Apple over the past year. Apple stock broke through the $600 barrier and has managed to stay there so far.
On Thursday Amazon reported its financial results for its first quarter of 2012. Amazon continues to spend vast amounts to build up its logistical infrastructure to get orders into customers’ hands quickly. While this is impacting profit in the near term, Amazon’s strategy appears to be paying off in generating more sales – for the quarter sales were up 34% (up 36% in North America and international sales were up 31%) year over year. Amazon’s shares gapped up almost 16% the day after the results were released.
While the Kindle Fire continues to be the number one bestselling item at Amazon, 9 out of 10 of the top selling items are digital products – Kindle, Kindle books, movies, music and apps. Amazon’s strategy of selling the Kindle Fire as a loss leader in order to sell content also seems to be working well.
In a statement Jeff Bezos said that there are now more than 130,000 ebooks that are exclusive to the Kindle Store.
Amazon also appears to be ready to make deals with states to collect sales tax. On Friday the company reached an agreement with Texas (via WSJ), which will end a bitter fight that saw Amazon close an existing distribution center there and cancel plans to build more when the state demanded $269 million in unpaid taxes last year. Amazon has entered into agreements to collect taxes in 12 states by 2016.
Research firm comScore, Inc. released highlights from one of its research products indicating that the Kindle Fire almost doubled its share of the Android tablet market in the study period, Dec 11, 2011 to Feb 12, 2012. According to comScore’s research the Fire is now the leading Android tablet in the U.S. by a wide margin, followed by the Samsung Galaxy Tab family with the Motorola Xoom in third place. Curiously, comeScore left out any mention of the Nook Tablet or Nook Color:
Update (05/04/2012): IDC has released a study that probably better reflects the current position of the Kindle Fire in terms of sales position. The study found that in Q1 2012 Apple increased its market share as Android tablet shipments dropped significantly. The Kindle Fire, according to IDC, now occupies third place in tablet sales behind the iPad and Samsung (comScore only concerned itself with Android tablets – not the iPad). IDC puts the Nook Tablets at fifth place. While the Kindle Fire was the top selling Android tablet and the second best selling tablet behind the iPad during the holidays, it has not been able to hold onto that position.
Meanwhile, for its first quarter of 2012 E Ink Holdings reported its first quarterly loss in 10 quarters (via DigiTimes). While part of this is seasonal and due to buyers of its e-ink displays adjusting their inventory after the holidays, one has to think that all of those Kindle Fire sales must be cannibalizing sales of the e-ink Kindle ereaders to some extent.
A couple of months ago Scott Liu, chairman of E Ink said regarding the first quarter of 2012, “currently we are in the slow season for retail sales of eReaders. Our customers are making inventory adjustments after the holiday season and we will not have significant market visibility until that is completed. We tend to be conservative in our sales estimates during the first quarter. However, in 2012 we expect to strengthen our competitiveness and continue development of both flexible and color ePaper technologies.” Liu went on to say that E Ink is actively expanding into the business and education markets.
No manufacturer seems able to bring an ereader with a reflective color display to market at a price that is viable in an iPad world. It appears that for most consumers who want color a backlit LCD screen is good enough.
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B&N reports Q3 2012 results; Launches new tablet model no comments
Barnes & Noble today reported its financial results for the third quarter of fiscal 2012, which ended Jan 28. In a continuation of recent trends, B&N’s online business continues to grow fast (32% over last year during the 3rd qtr), while sales at the physical stores only grew 2%. Earnings for the quarter would have been almost flat except for the impact of deferred income from textbook rentals. Barnes & Noble College is seeing increased adoption of textbook rentals and this revenue is deferred over the life of the rental term rather than being recorded when the sale is initiated. The sales of paper books in stores increased more than 4% over last year — I suspect this may be attributable to the demise of Borders.
B&N also announced the launch of a new 8GB version of the Nook Tablet that is priced at $199 and includes all of the features of the 16GB model except for the amount of built-in memory. 5GB of the new Tablet’s 8GB memory can be used for content, but 1GB of this is reserved for Nook Store content. B&N now has a Tablet that price matches the Kindle Fire. The Nook Color’s price has been reduced to $169.
There is also a new software update for the Nook Tablet. Version 1.4.2 appears to be a minor bug-squashing update that “provides minor system enhancements.”
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Amazon’s business growing fast – but it doesn’t come cheap no comments
Yesterday afternoon Amazon announced its financial results for the its third quarter ended September 30, 2011. Amazon’s sales were up 44 percent during the period, but the company continues to spend heavily to build infrastructure to service its rapidly growing business. This resulted in a 73 percent decrease in net income during the third quarter and a conservative outlook for the fourth quarter, which includes the holiday season.
"September 28th was the biggest order day ever for Kindle, even bigger than previous holiday peak days – we introduced Kindle Fire for $199, Kindle Touch 3G for $149, Kindle Touch for $99, and our all new Kindle for only $79," said Jeff Bezos, founder and CEO of Amazon.com. "In the three weeks since launch, orders for electronic ink Kindles are double the previous launch. And based on what we’re seeing with Kindle Fire pre-orders, we’re increasing capacity and building millions more than we’d already planned."
Investors seem to be less upbeat — from its opening price yesterday morning Amazon’s share price is down about 16 percent on heavy volume.
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Amazon releases Q2 2011 financials no comments
Amazon today reported its earnings for its second quarter, which ended June 30, 2011. The company’s worldwide revenue increased by 51 percent year over year, but net income decreased by 8 percent. Amazon’s growth came at the expense of some of its profit margin as it spent heavily to improve its infrastructure.
Amazon continued to experience much greater growth in its electronics and general merchandise categories than in did media sales.
A couple of Kindle related highlights from Amazon’s news release:
- Recently AT&T agreed to sponsor the Kindle 3G with Special Offers, which enabled Amazon to cut the ereader’s price to $139. It has become the best selling of the Kindle family of ereaders.
- The US Kindle Store now has over 950,000 titles. Over 800,000 of these are $9.99 or less.
Amazon’s shares were up almost 6 percent in afterhours.
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Barnes & Noble reports record sales no comments
Barnes & Noble today released its financials for its fiscal 2011 Q4 and the full year ended April 30, 2011. For FY2011 B&N reports an increase in total sales of 20 percent to $7 billion, which is a new record for the company.
B&N’s website saw a comparable sales growth of 78 percent in the fourth quarter and 65 percent for the full year as compared to FY2010. Comparable store sales were up by 0.7 percent for the year, led by the sale of digital products. For the quarter comparable in-store sales were down by 2.9 percent, which B&N is blaming on the Borders liquidations.
For FY2011 Barnes & Noble is reporting a loss of $74 million, or $1.31 per share. B&N’s digital initiatives are resulting in surging online sales and in-store sales of digital products are helping to offset declines in other areas, but the company’s expenses also grew.
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Barnes & Noble reports latest financial results no comments
Barnes & Noble reported its financial results for the quarter ended Jan. 29, 2011 (Q3 fiscal year 2011). While the company was very busy and sold a lot of stuff during the holiday season, profit was lower than some analysts expected as the bookseller (and seller of elves on shelves) continued to spend on the development of its digital strategy.
Total sales at B&N increased 7 percent over the same period last year. Online sales continue to surge — Barnes & Noble.com sales increased 64 percent — while in-store comparable sales increased by 7.3 percent. B&N College Booksellers comparable store sales were down 2.2 percent.
During the third quarter B&N launched the Nook Color ereader; Nook Newsstand digital periodical store; and the Nook Kids children’s Nookbook store. Barnes & Noble also filled more shelf space with toys and games.
“We’re pleased with our financial results this quarter, but just as importantly, the third quarter was another big quarter for the Company from the standpoint of key strategic progress that positions us well for the future,” said William Lynch, chief executive officer of Barnes & Noble, Inc. “In the digital area, our eContent business continues to scale quickly such that we now sell twice as many ebooks as we do physical books at BN.com. NOOK Color, launched in the third quarter, was named the best dedicated eReader by the Associated Press. We’re very encouraged by the sell-through of that break-through device, as well as the newly launched NOOK Newsstand subscription service and NOOK Kids children’s digital library. At retail, our enhanced Educational Toys & Games experience drove 47% comparable growth in the stores, and gives families yet another reason to feel good about shopping at Barnes & Noble.”
B&N declined to issue guidance for the final quarter of fiscal 2011. The reason given was that Borders’ bankruptcy and its liquidation sale may impact sales at B&N. Barnes & Noble also suspended its quarterly dividend of $0.25 in order to preserve capital.
B&N’s shares are down by more than 10 percent today on the news.
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E Ink Holdings releases Q4 and fiscal year 2010 financial results no comments
E Ink Holdings, which makes the displays for most 
dedicated ereaders, announced its financial results for the fourth quarter and fiscal year 2010. While last year saw ereader sales soar, it also saw prices fall rather steeply.
For the fourth quarter E Ink saw its consolidated sales soar up 84 percent quarter over quarter and 96 percent year over year to a record high of NT$9.7 billion ($329 million USD).
For the full year consolidated sales hit a new record of NT$25.2 billion ($847 million USD), which is up 57% year over year. Net income after tax for the year was NT$4 billion ($135.5 million USD) — also a new record.
“In 2010 we achieved several key milestones,” said Dr. Scott Liu, Chairman, E Ink Holdings, Inc. “We tripled the number of ePaper displays as shipped in 2009 for the eReader market alone, launched two new ePaper display platforms, E Ink Pearl™ and E Ink Triton™ and we have had strong demand from the Tablet PC market for our FFS technology-based LCD products.”
Update 2/16/2011: According to Digitimes, E Ink Holdings plans to triple its electrophoretic display production capacity in 2011 to accommodate demand for epaper displays.
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Barnes & Noble Reports Fiscal 2011 Q1 Results no comments
Barnes & Noble today reported sales and earnings for its fiscal 2011 first quarter which ended July 31, 2010.
Total sales for Q1 ($1.4 billion) were up 21 percent compared to last year. B&N’s embracing of digital reading has really been paying off – Barnes & Noble.com sales ($145 million) surged 42 percent over the prior year, although the online sales still only make up a little more than 10 percent of B&N’s total sales at this point. Still, just as ebook sales in general make up only a small percentage of current overall book sales, with growth rates like that ebooks (and B&N’s digital sales) are starting to add up to much more than just a hill of beans pretty quickly. Well, actually, maybe the bean counters like to see hills of beans.
“The company made significant strides executing its digital strategy during the first quarter, and all our key metrics on the digital business are well ahead of plan,” said William Lynch, chief executive officer of Barnes & Noble, Inc. “The company launched NOOK Wi-Fi, the most full-featured, low-cost dedicated eBook Reader on the market, the launch of NOOKstudy™, an innovative study platform that enables easy eTextbook and digital content management for college students, and the introduction of NOOK for Android™, free software that brings our eReading experience to millions using Android smartphones and the first of our eReading apps to feature Barnes & Noble’s new NOOK-centric branding. In addition, we are increasing the competitive advantage provided by our bookstores through the launch of full-service NOOK Boutiques, where customers can experience NOOK and speak with knowledgeable booksellers who provide device demonstrations and ongoing product support. Our digital strategy has clearly resonated with our customers as our Members – our best customers – with NOOK devices have increased their spending by approximately 20%. NOOK has also greatly expanded the Barnes & Noble customer base, with 25% of all NOOK customers new to BN.com.”
Meanwhile, in-store sales ($1 billion) were down two percent (.9 percent for comparable stores). The B&N College Bookstores did better than expected and saw a comparable store sales ($226 million) increase of 2.9 percent.
Unfortunately, unless my math is off, it looks as though B&N’s digital sales success is not making up for the decrease in store sales, at least during the time period in question.
Barnes & Noble also announced today that Jamie Lannone has been named President of Barnes & Noble Digital Products and John Foley has joined the company as President of Barnes & Noble eCommerce.
Lannone joined the company a year ago and has been serving as Executive Vice President. Foley is coming from IAC, where he has been for 13 years – most recently serving as the CEO of The Pronto Network. Foley is the founder of both Pronto.com and Proust.com.
In his new role, Iannone will be responsible for all NOOK™ eReading devices, software, accessories and retail integration and experiences; eBooks and digital content; and third-party partnerships. Foley will manage the BN.com online retail business including books, children’s books, toys and games, music, movies, home and gift items, electronics and marketplace, as well as merchandising, online and search marketing. The two seasoned executives will report to William Lynch, CEO of Barnes & Noble, Inc. supported by leadership teams and talented employees.
