Consulting and outsourcing services outfit Accenture slightly raised its full-year profit forecast, but the revised outlook was still below market expectations.
Accenture has invested heavily in its digital and cloud services, amid stiff competition from Cognizant and Biggish Blue.
Revenue in its consulting unit, which has a higher profit margin than its outsourcing business, increased 2.6 percent in the second quarter its slowest growth in more than a year.
Chief Financial Officer David Rowland told the press that he plans to write $1.5 billion cheques for acquisitions in the year ending August.
Accenture said it expects adjusted profit of $5.70 to $5.87 per share for its year ending August, slightly higher than its prior forecast of $5.64 to $5.87 per share.
However, the company narrowed its full-year revenue forecast growth range to 6 percent to 8 percent in local currency, from its earlier 5-8 percent range.
The new forecast points to revenue of between $34.86 billion to $35.51 billion.
Analysts on average are expecting a profit of $5.87 per share and revenue of $34.60 billion.
Accenture said second-quarter net revenue rose 4.7 percent to $8.32 billion, as it benefited from strong demand for its digital, cloud and security-related services, which made up more than 45 percent of revenue.
Net income attributable to Accenture fell to $838.8 million in the quarter, from $1.33 billion last year.
Profit in the year-ago quarter received help from a $553.6 million gain on the sale of some businesses.
The company’s profit in the second quarter was hurt in part by a higher tax rate and increased operating costs, up 4.3 percent to $7.62 billion.
Analysts on average had expected revenue of $8.34 billion.
Computacenter has issued an interim statement for 2016 where it said that it had done OK in a miserable period of UK history.
Computacenter said it had a lot to be happy about with a strong pipeline of managed services opportunities. The channel giant said that the 12 months ending 31 December had been ok overall the Group’s numbers will be in line with board expectations.
Group revenue was up by six percent for the year, service turnover improved by five percent and supply chain revenue was up by seven percent. Currency falls had been a real killer. Currency fluctuations with the pound and the dollar have been felt strongly in the UK, with some vendors increasing prices over the last few months and, not surprisingly, the numbers from Computacenter for the performance of this country were slightly down on last year.
UK revenue was down a percent, services dropped by eight percent with supply chain on the rise by three percent – some of that was as a result of a particularly strong Q4.
The outfit did much better in Germany with three percent growth and services up by seven percent and supply chain by one percent.
“We are encouraged by our performance in 2016 in Germany and pleased with the progress we have made in France. In the UK, the second half performance has been in line with our revised expectations, set at half year after a disappointing first half performance,” stated the firm in the update.
“We expect 2017 to be another year of progress for the Group as we continue our momentum in Germany, maintain our position in France and marginally improve on our 2016 performance in the UK. While in the UK we are reliant on a small number of large opportunities, our Managed Services pipeline across the Group is strong,” the statement added.
UK insecurity outfit Sophos today reported its interim results which showed that while revenues continued to rise, losses also widened.
Revenue increased to $256.96 million in the six months, up from $234.2 million in the same period last year. Sophos said its billings were up 15 percent while new customer billings were up 20 percent.
That still meant that it had an operating loss of $24.6 million which was an increase from $13.4 million from last year.
Sophos blamed the increased losses on investment into R&D, as well as a continued shift towards subscription-based billing.
Investors appeared largely satisfied first six months of results. The share price crept up by one percent today to 235 pence per share.
Kris Hagerman, chief executive officer said that he was pleased with Sophos’ first half results. They were in-line with Sophos’ outlook, and he was especially pleased with our cash flow performance which was ahead.
“As we enter the second half of the fiscal year we expect continued strong growth, as we benefit from key new product releases in next-generation endpoint and next-generation firewall, and the continued momentum of our Sophos Central cloud management platform,” Hagerman said.
For the year-ending 31 March 2017, the firm said that it expects to deliver mid-teens revenue growth whilst delivering ‘modest’ cash EBITDA margin expansion.
Beancounters at IDC claim that a flood of cheap tablets are killing off an already dying technology branch.
In a new report, IDC said that 43 million tablets shipped in Q3 2016 but that figure was actually the bad news. The overall market declined 14.3 percent year-on-year, because of poor sales at the top end of the market. Basically consumers switching to cheap tablets with lower margins.
While there is a .8 percent quarter-on-quarter increase in shipments as vendors get ready for the holiday quarter. the market’s pants.
Amazon with its Fire tablets were the only tablets to see significant growth. These were up 320 percent year-on-year but still only taking 7.3 percent of the market. Huawei sales increased 28.4 percent to 5.6 percent of the market.
Apple’s shipments fell 6.2 percent and Lenovo was down 10.8 percent. Samsung fell 19.3 percent.
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IDC senior research analyst Jitesh Ubrani said that they -$200 tablets were spoiling the market for everyone.
He said that the “The race to the bottom is something we have already experienced with slates and it may prove detrimental to the market in the long run as detachables could easily be seen as disposable devices rather than potential PC replacements”
The weak pound helped Computacenter’s bottom line by boosting the value of its business in mainland Europe.
The London-listed firm reported a two percent year-on-year rise in turnover to £735 million, more than £400 million of which was generated in Germany and France. Group services revenues grew by four percent as reported and the supply grew one percent.
The UK side of the business was as soft as a baby’s bottom but thanks to Brexit sinking the pound that hardly got noticed.
Sales were down three percent to £314 million, including a ten percent slump in services revenues. However the supply chain grew two percent.
“We are pleased to see a return to growth in our supply chain business, however, as broadly anticipated, our services revenue remains challenged principally due to the buoyant nature of projects in 2015,” the firm said.
In Germany things were much better. Revenues grew eight percent as reported to £325 million, but decreased two percent in constant currency. Service revenue was up 22 percent and the supply chain increased two percent.
France which normally was a blackspot on Computer Center’s revenues grew three percent to £83 million. Services and product sales also benefited from the currency translation.
Group funds totalled £96.7 million at the end of the quarter, up £29 million on the same period a year earlier.
The company forecasted sales of £3.1 billion for 2016, which would equate to a three percent rise as reported.
Channel outfit Softcat is reporting some rather good figures for its first public full year.
The channel player reporting strong results and a £28m special dividend. The firm saw a 12.8 percent increase in revenues to £672.3m and gross profit coming in at 17.5 percent up on last year at £120.7 for the year ended 31 July. That gross profit number was helped by a one-off procurement saving of £3.4m.
Softcat saw a 7.5 percent increase in customer numbers and increasd its staff by 21 per cent to support its growth plans.
The channel outfit went public in November last year and the share price has consistently outperformed the initial valuation.
Martin Hellawell, Softcat CEO, said that the last financial year had seen it open an office in Glasgow, add 133 to the workforce and pick up a clutch of best partner awards from leading vendors.
“We are pleased to report continued strong organic growth at Softcat with 12.8 per cent revenue growth, 17.5 per cent growth in gross profit and 15.2 per cent growth in adjusted operating profit, achieved against a backdrop of very modest growth in the UK economy which has equally been reflected in the IT market,” he said.
“We have continued to win large numbers of new customers and earn increased spend from our existing customers. This has been achieved by our relentless focus on customer service, which is in turn driven by an excellent and engaged team of people at Softcat,” he added.
Dixon Carphone attempted to play down the personal impact of market volatility that a post-Brexit vote will “inevitably” cause.
Dixon Carphone CEO Seb James talked bullishly about the business and its prospects but noted that things could get a bit edgy since Friday’s EU referendum.
“The nation has spoken and there has been a vote to exit the EU in due course. As you can imagine, we have been giving some thought to this,” he said.
“Our view is that, as the strongest player in our market and despite the volatility that is the inevitable consequence of such change, we expect to find opportunities for additional growth and further consolidate our position as the leader in the UK market,” said James.
Dixon Carphone said group sales edged up three per cent year-on-year to £9.78bn for the year ended 30 April. Sales in its UK heartland went up one per cent to £6.4bn, reflecting stores closure.
Demand for white box goods offset weaker trade in computing, TV sales benefited from the Rugby World Cup last year it said. The mobile element saw market share gains helped by the store within a store concept, the launch of a 4G network branded iD and lasting benefits of Phones4You going pop in the prior financial year, the company said.
Connected World Services jumped to £152m from £121m. Dixon has a deal to roll out CWS in Sprint stores across the pond.
Profit for the year was £337m, up from £285m in the prior financial year.
Britain’s Vodafone posted a rise in its quarterly sales for the first time in nearly three years.
This was thanks to improving trends in its key European markets and demand for its 4G mobile services.
The world’s second largest mobile operator said the rise in fourth quarter revenue of 0.1 percent, which followed 10 quarters of declines, meant that its overall earnings could also stabilise in 2016.
Vodafone has been hit hard by the constraints on consumer spending in its big European markets and by regulator-imposed price cuts, forecast a range for 2015-16 earnings of £11.5 billion pounds to “£12 billion.
Compared to the £11.9 billion pounds it reported for the 2014-15 period the company could be heralding a return to growth following seven straight years of earnings decline.
Analysts say Vodafone has a tendency to set a cautious outlook so the figures might even be better than that.
Chief Executive Vittorio Colao said the company had seen increasing signs of stabilisation in many of its European markets, supported by improvements in its commercial execution and very strong demand for data.
Vodafone has 446,000 mobile customers in countries ranging from Albania to Spain, Qatar, India, South Africa and New Zealand. However, in the EU, customers cut back on using their phones at a time when Vodafone needed to invest in new networks.
With growth also slowing in its emerging markets, Vodafone embarked on a programme to either build or buy superfast fixed-line broadband networks to compete with rivals offering mobile contracts alongside television, broadband or fixed-line deals.
Red Hat has surprised the cocaine nose jobs of Wall Street by being able to stick to its profit forcast, despite the US dollar shooting through the roof.
Red Hat predicted it would make a profit for the first quarter that matched analysts’ estimates despite warning on a strong dollar hurting its revenue.
Red Hat shares were up five percent in after-market trading after the company’s profit beat the average analyst estimate for the eighth straight quarter.
The company also said a $500 million share buyback program will replace an existing $300 million programme.
Red Hat gets nearly half its revenue from international operations and expected to suffer from the US dollar’s strong gains. HP, Microsoft and IBM had estimated a significant impact from the dollar’s gains.
The company, whose customers include Adobe and Verizon, forecast an adjusted profit of $469 million-$474 million for the first quarter.
Red Hat also forecast a revenue of $1.99-$2.02 billion for the full year. Analysts were expecting revenues of $2.02 billion.
The company’s billings revenue was $688 million in the fourth quarter. Analysts had expected $646.2 million.
Sony seems to be starting to recover from its period of falling profits and woe.
The Japanese consumer electronics maker said its official third-quarter operating profit was $1.5 billion, up 2.2 percent from what it thought it would get last month.
Apparently there was a boost to the bottom line by strong sales of sensors and videogames it also has been cutting back and looking down the back of the sofa for the odd penny or two.
Sony said that its earlier estimate wasn’t final, as Sony had not yet compiled accurate data for its Hollywood movie studio after a massive hack into its computer systems. On February.4 Sony said third-quarter operating profit was nearly double year-earlier and a sign that its nadgers were out of the fire and had an ice pack placed on them.
Sony said that including official results for the movie studio, quarterly revenue rose 6.5 percent from a year earlier.
Forecasts for the full-year ending March 31 were unchanged.
Sony shares have risen more than 30 percent so far this year on hopes of a turnaround, following a program of massive cuts in unprofitable segments and targeted expansion in lucrative areas such as sensors for smartphone cameras.
French telco Orange is not doing that well and has surrendered on the idea of getting a recovery before 2018.
Orange has announced it would take at least until then for sales and core operating profit to exceed 2014 levels as pressure would continue in its domestic market.
Chief Executive Stephane Richard said he thought the low point for group sales would come next year, while earnings before interest, tax, depreciation, and amortization (EBITDA) would bottom this year.
“Our revenues have been falling for five years. We’ve been through a major re-set in France and the impact is still being felt, although most of our customers have passed over to the lower prices,” he said on a conference call.
His cunning plan calls for Orange to invest more in its networks in the coming years, putting more than $15.87 billion in to mobile and fixed networks upgrades to boost broadband speeds as it seeks to differentiate from competitors with better quality of service.
Cost cutting efforts will also continue with a further three billion euros in gross savings targeted through 2018 on par with an earlier cost cutting plan that was lauded by investors.
Network equipment maker Cisco reported stronger than expected quarterly revenue and profits as demand for switching equipment and routers picked up.
Cisco has been trying to move towards a new cycle of high-end switches and routers.
Its switching business, which makes products that handle traffic at large internet data centres, netted 39 percent of Cisco’s total hardware revenue in 2014, while the router business accounted for about 21.2 percent.
This means that the outfit is seeing robust switching sales, which is good news for other outfits in the sector such as Infoblox, Gigamon and F5 Networks which should also be doing well.
Rvenue from Cisco’s hardware business rose 7.8 percent to $9.08 billion in the company’s second quarter ended Jan. 24.
Revenue from services, which includes the company’s software and cloud offerings, rose 4.6 percent to $2.86 billion.
So analysts think that Cisco has put the worst behind it and should start returning to the days when it was a blue chip investment.
Chief Executive John Chambers said that the quarter showed the best balance of growth across all of the company’s geographies, products and segments,.
Cisco said its net profit rose to $2.4 billion in the quarter from $1.43 billion, a year earlier. Total revenue rose seven percent to $11.94 billion.
Analysts on average had expected a revenue of $11.8 billion.
Kramer added that while Cisco has made progress in the second quarter, the company will continue to be affected by headwinds from emerging markets and telecom service providers.
The company also forecast revenue growth of 3-5 percent.
It seems that the British chip designer ARM has done a lot better than the cocaine nose-jobs of Wall Street have predicted.
ARM posted a 25 percent rise in fourth-quarter profit, ahead of expectations, helped by a strong year end in companies licensing its technology and growing royalty revenues.
The Tame Apple press claims that the ARM success has all been down to Apple’s iPhone 6, although ARM powers most of the world’s smartphones.
ARM reported pre-tax profit of 118.9 million pounds on revenue of 225.9 million pounds, up 19 percent.
Licensing revenue was up 27 per cent on the year mainly based on 53 licences signed for processors.
“We anticipate that total group dollar revenues for Q1 will be up about 10 percent year on year, based on strengthening royalty revenue growth, and our expectation of the profile of license revenue through the year,” the company said.
Analysts were predicting pre-tax profit of £113 million, according to a consensus compiled by Thomson Reuters.
Electronics giant Sony appears to be pulling out of its death spiral.
The consumer electronics firm said on Wednesday preliminary results showed that operating profit had doubled to $1.52 billion in the October-December quarter, while sales rose 6 percent.
This was well ahead of what the cocaine nose jobs of Wall Street expected and they rushed from their expensive loos screaming “buy, buy, buy.”
To be fair, the company is not home and hosed yet. In fact it could not even be said to be at the front gate contemplating a nice hot bath and a rigorous toweling down.
Sony also forecast a preliminary full-year net loss of $1,44,841,1900 but since this was better than the than its forecast last October estimating a net loss of $ 1,959,616,100 for the year no one appears to be quibbling.
The company had said it would delay announcing the official results for the third quarter as its Hollywood studio struggled to recover from a massive hacking of its computer systems. The company, in the midst of a restructuring, said on Wednesday its Chief Executive Kazuo Hirai would announce a “new business strategy” on February 18.
The company will cut 2,100 jobs in the unit by the end of the next fiscal year through March 2016, including around 1,000 cuts already announced.
Sony’s image sensors have emerged as one of its best performing product lines in recent quarters.
Despite a miserable year for the smartphone industry, Lenovo managed to do rather well and saw its third quarter revenue rise 31 percent to $14.1 billion.
This beat what the cocaine nose-jobs of Wall Street expected as its mobile division sales more than doubled following its acquisition of Motorola.
Lenovo wrote a cheque for $2.91 billion for Motorola, the US handset brand with a long sales history in the United States and Europe, as part of an effort to diversify away from the shrinking PC market.
These results took into account two months of Motorola’s performance and Lenovo said Motorola sold more than 10 million handsets during the quarter for the first time.
This is good news as Lenovo has been having trouble in its home market of China. Xiaomi swept aside Lenovo in China but has largely avoided Western markets due to fears of intellectual property challenges.
The company is expected to make a comeback against Xiaomi in China by adopting its rival’s Internet distribution model. Lenovo in May signed a deal with e-commerce site JD.com and announced a subsidiary last month to sell smartphones and wearables exclusively online.
Under Lenovo, Motorola will re-enter the Chinese market and be distributed primarily online, Yang said.
Total sales from the mobile division leapt 109 percent to $3.39 billion, or a quarter of the company’s sales.
Lenovo said net profit was $253 million, down from $265 million a year prior due to ballooning expenses associated with closing two major acquisitions. The Beijing-based company also acquired IBM’s low-end server unit for $2.1 billion.
The results beat expectations of $13.71 billion in revenue and $200 million in net profit.
Lenovo continued to consolidate its hold on the PC market, reaching a record 20 percent share during the quarter with sales of $9.15 billion. Shipments rose five percent compared with a three percent decline in the broader industry, with growth particularly strong in Eastern Europe.