AMZN

Groupon’s Results Miss the Mark; Liquidity Not a Concern…Yet

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Once again, online deals retailer Groupon (GRPN) missed the mark when it reported third quarter results Thursday afternoon. Revenue fell slightly short of expectations, growing 32% year-over-year to $568.6 million. The firm’s loss shrank to $2.9 million, or break-even on a per share basis, which was short of consensus calling for a profit of $0.03. Roughly 80% revenue expansion in North America was overshadowed by weak 3% international growth. Further, third party and other revenue was flat year-over-year at $423.5 million. All of Groupon’s growth came from Groupon Goods, as Direct Revenue increased significantly year-over-year to $144.9 million and doubled quarter-over-quarter. However, we’re not too bullish on this dramatic shift. Gross margins in the Groupon Goods business totaled 12% compared … Read more

Amazon Continues to Lose Money; Market Continues to Not Care

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Online giant Amazon (click ticker for report: ) reported another quarter of solid revenue growth masked by subpar profitability Thursday afternoon. Revenue surged 27% year-over-year to $13.8 billion, just below consensus estimates. Earnings swung to a loss of $0.23 per share compared to a profit of $0.14 last year, on an adjusted basis, which was much worse than expected. On a GAAP-basis, the company lost $0.60 per share thanks to recognizing a large loss on deal site LivingSocial. The tech giant continues to focus on taking market share and damaging its competitors rather than generating large profits. CEO Jeff Bezos announced the Kindle Fire HD, a tablet that sells for approximately breakeven, is the number one selling product on Amazon.com, … Read more

Netflix Subscriber Growth Slows While Profitability Shrinks

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Maligned DVD rental and video content streaming service Netflix (click ticker for report: ) reported third quarter results that were a little better than expected, but overall, not incredibly strong. Revenue grew 10% year-over-year to $905 million, roughly in-line with consensus estimates. Earnings tumbled, falling 89% year-over-year to $0.13 per share—significantly higher than consensus estimates but still not a great number, in our view. While we enjoyed CEO Reed Hastings candid letter to shareholders with regards to the business outlook, he pointed out several weaknesses. Domestic streaming subscriber additions are estimated to be 4.7 million-5.4 million, much lighter than the firm’s previous guidance of 7 million. Hastings pointed to several metrics, including 30%+ growth in per-member viewing that suggests consumers … Read more

Why We Continue to Like Apple and Microsoft

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In yet another negative blow to the PC market, Gartner reports that PC shipments fell 13.8% year-over-year during the third quarter. The big losers, yet again, were the PC giants Dell (click ticker for report: ), HP (click ticker for report: ), and Toshiba. Of course, the shocking loser was Apple (click ticker for report: ), which saw shipments fall 6% (considerably lower than the 25%+ drops of competitors), though market share increased 110 basis points to 13.6%. With the entire industry slumping, who’s to blame? Not surprisingly, we’re labeling Apple as the major disrupter in the PC market. Since the inception of the iPhone and subsequent iPad releases, computing has shifted more and more toward mobile consumption, with the … Read more