or Connect
AppleInsider › Forums › General › General Discussion › Google misses Q2 earnings estimates despite revenue and profit rise, Microsoft loses $900M on Surface RT
New Posts  All Forums:Forum Nav:

Google misses Q2 earnings estimates despite revenue and profit rise, Microsoft loses $900M on...

post #1 of 80
Thread Starter 
Two tech giants and Apple competitors revealed their earnings for the past quarter today, with Google missing estimates despite solid revenues and improved profit, while one of Microsoft's first in-house tablet attempt was shown to be a certifiable failure.



Google reported income of $3.23 billion on $13.11 billion in revenue for the quarter ending June 30. Including its Motorola operations, Google's revenue was $14.11 billion, up considerably over the $11.81 billion figure it posted for the year-ago period. Net income for the year-ago quarter was $2.79 billion.

Despite the rise in both profit and revenue, Google shares dropped more than five percent in after-hours trading. The search giant reported that the average price it receives for its online advertising business had declined six percent year-over-year in the second quarter. That decline came in the wake of a four percent drop from the first quarter.

The Motorola division, which is preparing to launch a new flagship phone, saw revenues of $988 million in the quarter. That division has continued to lose money for Google, posting a loss of $342 million this past quarter.

Microsoft, meanwhile, posted lower-than-expected quarterly earnings, reflecting the software giant's continuing struggle to adapt to the new computing paradigm. The Redmond company's revenue for the quarter rose 10 percent to $19.9 billion, aided in part by sales of its Office productivity suite. Analysts, though, had expected Microsoft to post $20.7 billion in revenue.

Surface WiFi


The Windows maker saw a net income of $4.96 billion for the quarter. In the year-earlier period, Microsoft posted a $492 million loss, its first quarterly loss since going public in 1986. That negative figure stemmed largely from a massive writedown for its online services division.

Once again, Microsoft was forced to take a sizable writedown this quarter. This time the firm wrote down 66 cents per share on its failed Surface RT device. Microsoft recently cut the price of the Windows RT-based Surface unit, which has struggled to attract consumers even though it was meant to take on Apple's bestselling iPad.

The total value of the Surface RT writedown came to $900 million. Microsoft representatives said the company is aware of its problem in competing with the iPad and is working to address it.

""I want to be very clear," said Microsoft CFO Amy Hood, according to The Wall Street Journal, "we know we have to do better, particularly on mobile devices."
post #2 of 80
"I want to be very clear," said Microsoft CFO Amy Hood, according to The Wall Street Journal, "we know we have to do better, particularly on mobile devices."

Really? Two words of advice then...Fire Ballmer!

That is all.
post #3 of 80

Yow. Two big misses.

 

Google GAAP earnings flat at best; Moto is a continuing (and growing) money leak. Worst of all, per click ad rev, their real bread and butter, continues to deteriorate. How is (well, was) GOOG carrying a 28 P/E?

 

MSFT continuing to crumble in a post-PC world, like the proverbial train wreck in slo-mo. Big miss even before the ~ billion dollar Surface RT write-off.

 

I'd say that any rational response to this would be to invest in AAPL, but the market is not rational - wouldn't surprise me to see it dragged down tomorrow.

post #4 of 80
Dont know if firing Ballmer will help. But im sure Bill is advising Ballmer too behind the scenes.
post #5 of 80

"That's the biggest miss we've ever seen from Microsoft, the biggest that I could remember," said Brendan Barnicle, an analyst at Pacific Crest Securities. "It looks like everything was weak and that's what we need an explanation on."

 

http://finance.yahoo.com/news/microsoft-profit-below-estimates-tablet-201712038.html

post #6 of 80

"Once again, Microsoft was forced to take a sizable writedown this quarter. This time the firm wrote down 66 cents per share on its failed Surface RT device."

 

I know I am not the only one to say this: This is what happens when a company only ships and doesn't sell. So perhaps those who insist that Samsung is not really selling a large number of smartphones can finally understand (or admit) that there's a consequence to building products that no one buys. And that consequence eats into profits.

post #7 of 80

The Surface RT: The answer to a question no one was asking. Make a device that is useful for more than writing Word documents and dancing like a hipster douche and you might get people to buy more.

post #8 of 80
Quote:
Originally Posted by pdq2 View Post

Yow. Two big misses.

 

Google GAAP earnings flat at best; Moto is a continuing (and growing) money leak. Worst of all, per click ad rev, their real bread and butter, continues to deteriorate. How is (well, was) GOOG carrying a 28 P/E?

 

 

I'm confused, Google's income is up 16% since this quarter last year, and their revenue is up a "considerable" 19%. That is flat? 

 

Or are the numbers in the article not GAAP?

post #9 of 80
Google and Microsoft join Apple's doomed future. /s
post #10 of 80
Quote:
Originally Posted by afrodri View Post

 

I'm confused, Google's income is up 16% since this quarter last year, and their revenue is up a "considerable" 19%. That is flat? 

 

Or are the numbers in the article not GAAP?

Maybe they were referring to either GAAP operating income or operating margin? Because that was actually flat.

post #11 of 80
Neither MS nor GOOG is going to see much appreciable loss in investment confidence. Investors WANT to believe in what they're selling, even if it doesn't make sense from a financial perspective. This is true for Amazon as well and up to a point RIM had Wall Street on their side when they should have been dumped and/or accused of fraud.

Investors are emotionally invested in certain companies. It's true for Apple as well, but Apple has historically been on the wrong side of big investors for so many years that they still have trouble getting the respect (and in turn investment) from much of the Street. Lots of investors got in when they realized Apple was killing everyone else, but they've just as quickly gotten out or started to bet on a loss with Apple, thinking "they have to fall at some point".

They forgive everyone else for the bone-headed products and moves, but when Apple disappoints the Street by beating their (the Streets) baseless forecasts, they get punished. It's sad really.
post #12 of 80
Originally Posted by AppleInsider View Post

... Microsoft's first in-house tablet attempt was shown to be a certifiable failure.

 

Surprise!

 

 


Originally Posted by AppleInsider View Post

""I want to be very clear," said Microsoft CFO Amy Hood, according to The Wall Street Journal, "we know we have to do better, particularly on mobile devices."
 

Amy, we all love you and we want you to get well again.

The first step to recovery is admitting you have a problem.

.

Sent from my iPhone Simulator

Reply

Sent from my iPhone Simulator

Reply
post #13 of 80
Quote:
Originally Posted by afrodri View Post

 

I'm confused, Google's income is up 16% since this quarter last year, and their revenue is up a "considerable" 19%. That is flat? 

 

Or are the numbers in the article not GAAP?

 

I'm confused too:

 

Quote:
GAAP operating income in the second quarter of 2013 was $3.12 billion, or 22% of revenues. This compares to GAAP operating income of $3.24 billion, or 27% of revenues, in the second quarter of 2012.
 
GAAP net income including net income from discontinued operations in the second quarter of 2013 was $3.23 billion, compared to $2.79 billion in the second quarter of 2012. Non-GAAP net income in the second quarter of 2013 was $3.23 billion, compared to $3.36 billion in the second quarter of 2012

 

Not sure how net income can be _more_ than operating income, so I'd suggest checking the link - see if you can figure it out.

 

I'm always a tad suspicious when the earnings are presented 10 different ways, including/excluding income from discontinued operations, or including/excluding stock-based compensation, etc, etc.

post #14 of 80
The RT - a total crash and burn. as predicted DOA by almost all of us here.
post #15 of 80

amazed that is all they lost on the RT - really only inventory - put in marketing cost and this thing was a disaster. Surface RT was just another tablet with a mickey mouse OS, good riddance.

post #16 of 80
Quote:
Originally Posted by pdq2 View Post

Yow. Two big misses.

Google GAAP earnings flat at best; Moto is a continuing (and growing) money leak. Worst of all, per click ad rev, their real bread and butter, continues to deteriorate. How is (well, was) GOOG carrying a 28 P/E?

MSFT continuing to crumble in a post-PC world, like the proverbial train wreck in slo-mo. Big miss even before the ~ billion dollar Surface RT write-off.

I'd say that any rational response to this would be to invest in AAPL, but the market is not rational - wouldn't surprise me to see it dragged down tomorrow.
Two words: The Fed. Doesn't apply to Apple because the media and Wall Street clowns decided Apple is no longer cool. I'm just waiting for the coming bubble to pop. Google, Amazon, Netflix etc. are so over valued its not even funny,
post #17 of 80

Schadenfreude.

   Apple develops an improved programming language.  Google copied Java.  Everything you need to know, right there.

 

    AT&T believes their LTE coverage is adequate

Reply

   Apple develops an improved programming language.  Google copied Java.  Everything you need to know, right there.

 

    AT&T believes their LTE coverage is adequate

Reply
post #18 of 80

PC World reports:

Source: Microsoft Surface RT isn't dead

"This parrot's not dead - it's just pining!"

post #19 of 80

Google's losses probably came from their Chromebook!  LOL!  

post #20 of 80
There is (at least) one upside here. With Intel, Nokia, Google and Microsoft reporting disasters... we can enjoy at least one day where the conspiracy of dunces, from the usual Motley Fool idiots (Munarriz, Niu, Heller, Bylund), nor that Yarow tool, nor any of the (mostly) self-serving Seeking Alpha idiots, not even the biggest ciown of them all, the former porn actor Rocco Pendola at the Street, had enough guts to come out with a doomsday Apple article.

(Now I just hope Apple's numbers next week will not make them come out again.)

P.S.: Somebody else noticed it, somehow. http://247wallst.com/technology-3/2013/07/18/the-first-day-in-memory-no-one-cared-about-apple/
Edited by dreyfus2 - 7/18/13 at 6:58pm
post #21 of 80
As an admirer of Apple and it's products I have to say that I'll ignore this irrelevant crap just like I do when it happens to Apple.

The entire system is ridiculous.

Traders and analysts, people who trade and analyse because they don't appear confident enough in their abilities to actually run a company, not to mention people with horrendously varied performances records themselves, decide how much value to assign to said companies based on 'what they think may happen in the future'.

Favorites aside, all three of these companies are generating such phenomenal amounts of income that, even if we were to take worst case example Microsoft's track record over the past ten or so years, not one of them is likely to disappear any time in the near future.

If that isn't the kind of thing that we should be investing in then I don't know what is.

Short-term thinking, people: providing a solid return in f@cking up the planet in more ways than you can imagine.
Apple managed the astonishing feat of getting the equivalent of a personal computer into the hands of everybody from eight to eighty year olds, and did so while providing absolutely no instructions...
Reply
Apple managed the astonishing feat of getting the equivalent of a personal computer into the hands of everybody from eight to eighty year olds, and did so while providing absolutely no instructions...
Reply
post #22 of 80

I never understood the difference between the Surface tablet and the Surface RT tablet?

 

Also, what is the difference between Windows 8 and Windows 8 RT?

 

That pretty much explains it all!  

post #23 of 80
Quote:
Originally Posted by afrodri View Post

 

I'm confused, Google's income is up 16% since this quarter last year, and their revenue is up a "considerable" 19%. That is flat? 

 

Or are the numbers in the article not GAAP?

margins are falling which is a precursor to lower growth or negative growth

 

remember apple over the last two years? first the margins started to fall last year and the numbers only went bad early this year

post #24 of 80
Quote:
Originally Posted by richsadams View Post

"I want to be very clear," said Microsoft CFO Amy Hood, according to The Wall Street Journal, "we know we have to do better, particularly on mobile devices."

Really? Two words of advice then...Fire Ballmer!

That is all.

 

NOOOOOOOO!!!!  Ballmer is the best thing that ever happened to Apple! The guy must stay on as CEO, even after they wheel his dementia-ladden body out on stage to yell DEVELOPERS DEVELOPERS DEVELOPERS DEVELOPERS ... in the year 2030.

"That (the) world is moving so quickly that iOS is already amongst the older mobile operating systems in active development today." — The Verge
Reply
"That (the) world is moving so quickly that iOS is already amongst the older mobile operating systems in active development today." — The Verge
Reply
post #25 of 80
Quote:
Originally Posted by curveddesign.com View Post

I never understood the difference between the Surface tablet and the Surface RT tablet?

 

Also, what is the difference between Windows 8 and Windows 8 RT?

 

That pretty much explains it all!  

The difference: The first one stinks like holly shit!!! The later one somehow reeks even more. Don't even poke them with a long stick.

"That (the) world is moving so quickly that iOS is already amongst the older mobile operating systems in active development today." — The Verge
Reply
"That (the) world is moving so quickly that iOS is already amongst the older mobile operating systems in active development today." — The Verge
Reply
post #26 of 80
Quote:
Originally Posted by curveddesign.com View Post

I never understood the difference between the Surface tablet and the Surface RT tablet?

 

Also, what is the difference between Windows 8 and Windows 8 RT?

 

That pretty much explains it all!  

Surface RT and Windows 8 RT run on ARM-based devices and do not support desktop applications. Imagine all your Steam games and existing Windows apps being effectively unsupported. I cannot imagine why it failed so miserably.

post #27 of 80
MS Tablet Development circa 2009




http://gizmodo.com/5365299/courier-first-details-of-microsofts-secret-tablet


and this...

Microsoft Courier Lives On Via New iPad Apps


http://www.pcmag.com/article2/0,2817,2402406,00.asp



and this...

http://news.cnet.com/8301-10805_3-20128013-75/the-inside-story-of-how-microsoft-killed-its-courier-tablet/#!



Paraphrasing Boss Tweed: "I seen my opportunities, and I screwed'em up!"
"Swift generally gets you to the right way much quicker." - auxio -

"The perfect [birth]day -- A little playtime, a good poop, and a long nap." - Tomato Greeting Cards -
Reply
"Swift generally gets you to the right way much quicker." - auxio -

"The perfect [birth]day -- A little playtime, a good poop, and a long nap." - Tomato Greeting Cards -
Reply
post #28 of 80
Quote:
Originally Posted by Negafox View Post

Surface RT and Windows 8 RT run on ARM-based devices and do not support desktop applications. Imagine all your Steam games and existing Windows apps being effectively unsupported. I cannot imagine why it failed so miserably.


Correction.  It is confusing to say desktop applications.  Why not just say Windows applications? 

post #29 of 80
Quote:
Originally Posted by pdq2 View Post

Not sure how net income can be _more_ than operating income, so I'd suggest checking the link - see if you can figure it out.

I'm not going to bother checking the link because it's not difficult for net income to be greater than operating income. In fact, it very often is.

In the simplest case, let's say you make $1 B in operating income and earn $100 M in interest on your investments. That gives you net income of $1.1 B.
Quote:
Originally Posted by curveddesign.com View Post

I never understood the difference between the Surface tablet and the Surface RT tablet?

Also, what is the difference between Windows 8 and Windows 8 RT?

That pretty much explains it all!  

Come on, it's not that hard.

Surface RT (and Windows 8 RT) is an ARM device which runs only 'tablet' apps. It does not run your normal x86 Windows apps.

Surface and Windows 8 is a full-blown x86 computer which will run most of the apps that you run on your desktop.
"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
Reply
"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
Reply
post #30 of 80
Quote:
Originally Posted by MikeJones View Post

The Surface RT: The answer to a question no one was asking. Make a device that is useful for more than writing Word documents and dancing like a hipster douche and you might get people to buy more.

Hip in the 80s.

"Apple should pull the plug on the iPhone."

John C. Dvorak, 2007
Reply

"Apple should pull the plug on the iPhone."

John C. Dvorak, 2007
Reply
post #31 of 80
Quote:
Originally Posted by jragosta View Post

Quote:
Originally Posted by curveddesign.com View Post

I never understood the difference between the Surface tablet and the Surface RT tablet?

Also, what is the difference between Windows 8 and Windows 8 RT?

That pretty much explains it all!  

Come on, it's not that hard.

Surface RT (and Windows 8 RT) is an ARM device which runs only 'tablet' apps. It does not run your normal x86 Windows apps.

Surface and Windows 8 is a full-blown x86 computer which will run, poorly, most of the apps that you run on your desktop.

Fixed that for you 1smile.gif
"Swift generally gets you to the right way much quicker." - auxio -

"The perfect [birth]day -- A little playtime, a good poop, and a long nap." - Tomato Greeting Cards -
Reply
"Swift generally gets you to the right way much quicker." - auxio -

"The perfect [birth]day -- A little playtime, a good poop, and a long nap." - Tomato Greeting Cards -
Reply
post #32 of 80
Quote:
Originally Posted by afrodri View Post

 

I'm confused, Google's income is up 16% since this quarter last year, and their revenue is up a "considerable" 19%. That is flat? 

 

Or are the numbers in the article not GAAP?

 

Join the club. Apple goes through the same nonsense every quarter.

post #33 of 80
Yikes. Combine this bad news with the rumor that iOS 7 may have iWork productivity apps for free in the fall - Apple products will look SO attractive that the bad news for Microsoft may just be beginning. Even if they can't come out on top and have to settle for second place at the mobile/tablet-computing table, that's better than not being at the table at all!

Combine THAT possiblilty with the shrinking importance of the desktop market makes for a questionable future for Microsoft. That would actually be sad. Yes I'm an Apple fan and I just wrote that. Love them or hate them you have to admit there's a lot for computing that Microsoft has brought into the world. There are a lot of smart people that work there - they should be better than this. Even as an Apple fanboy I have to say competition is good.
post #34 of 80

So the RT turns out to be a massive turd son of Zune? But it's Apple that is doomed? Apple fanboys get accused of living in a RDF? The Windows RDF dwarfs any Apple RDF.

post #35 of 80
Was that courier tablet even close to being a physical prototype? How practical would it have been? Looks like it would be quite heavy and not sure how it would close. Would each display have its own battery?
post #36 of 80
Quote:
Originally Posted by Rogifan View Post

Was that courier tablet even close to being a physical prototype? How practical would it have been? Looks like it would be quite heavy and not sure how it would close. Would each display have its own battery?

There are conflicting stories about that, even from within MS. I guess the most relevant point remains that MS did leak these videos in a timely fashion to cause damage to the iPad. So, they deserve all the sarcasm they can get. (And the question if it was a real thing, a fantasy, a study or whatever... became highly irrelevant.)
post #37 of 80
China slowing down, Australia slowing down, Europe still going nowhere and teetering on the brink of more Euro and debt trouble and now big corporations missing estimates - colour me surprised.
post #38 of 80

Microsoft's reign is over. Google is starting to crack and its stock will be cut in half in the next 18 months.

post #39 of 80
Quote:
Originally Posted by Malic View Post

Yikes. Combine this bad news with the rumor that iOS 7 may have iWork productivity apps for free in the fall - Apple products will look SO attractive that the bad news for Microsoft may just be beginning. Even if they can't come out on top and have to settle for second place at the mobile/tablet-computing table, that's better than not being at the table at all!

Considering that all Surface tablets ("pro" or not) do at least require a $100 keyboard / trackpad attachment to make them somewhat usable for anything... I am not sure Apple even has to go there. All of Apple's apps (each of them beating Office on the RT by miles) together, even adding in iPhoto and Garageband, cost less. Now.

MS is far from being even in the running for "second place". They have to pass Amazon, Samsung, Google/Nexus, too. Plus all the more successful Win 8 tablet / hybrid makers like Lenovo... MS is not even on the map.
post #40 of 80

Google.

Wonder how much longer before they kill Motorola, like HP did to Palm, or sell it off for a loss.

 

Microsoft.

Surface RT = Surface Really Tanks

Windows 8 = Windows h8

Wonder if Steve Ballmer is on a '3 strikes & your out' contract as CEO? If so, 1 more &...

New Posts  All Forums:Forum Nav:
  Return Home
  Back to Forum: General Discussion
AppleInsider › Forums › General › General Discussion › Google misses Q2 earnings estimates despite revenue and profit rise, Microsoft loses $900M on Surface RT