Amidst rumors that Microsoft (MSFT) is making progress on the next version of its Windows operating system, which may be “Windows 8,” but which is being referred to at the moment as “Windows Next,” and which is expected to make changes to accommodate tablet computers, Citigroup’s Walter Pritchard this morning offers some thoughts on what to expect and what it means to Microsoft.

He sees a beta version by September 15th, he’s not sure if the software will have sufficient “eye candy,” and he thinks that it’s not too late for WIndows to become number two in tablet software behind Apple’s (AAPL) iOS.

Regarding the time frame, Pritchard bases his analysis on what seems to be publicly available commentary from the company, as well as his knowledge of Microsoft’s historical pattern of software releases:

Microsoft has announced “that the next version of Windows will support a new kind of hardware, system-on-a-Chip (SoC) architectures, that will power the next generation of devices” at CES 2011. […] We believe the product shown on stage employed working code and suggest to us that the Microsoft is farther along in the Windows “Next” development process than many expect. The company has repeatedly stated that “24-36 months” between releases is the appropriate timeframe to consider for the launch of the next Windows operating system. With Windows 7 having been released in October 2009, a strict mapping of the “24-36 month” timeline would suggest a release as early as October 2011 and as late as October 2012 release.

What’s more, Microsoft still has lots of “goodwill” among developers, so those coders may fall in line. The appeal for Microsoft’s enterprise customers would be stronger than for the consumer market, he thinks.

From a financial perspective, tablet prices are not so much the concern for Microsoft: “Are tablets a good business? Yes, but it all comes down to unit shipments. We don’t believe ASPs are the most important question.”

Pritchard is not sure the next Windows “will be a raving success,” as he puts it, but the stock is so cheap, the expectations so low, it’s worth a bet in his mind: he reiterates a Buy rating and a $35 price target.

Microsoft shares today are up 18 cents, or 0.7%, at $24.85.

Article courtesy of Tech Trader Daily

Shares of video game maker Take-Two Interactive (TTWO) are up 3 cents at $16.13 down 35 cents, or 2%, at $15.75, after the stock was briefly halted in advance of its fiscal Q4 report, which easily beat estimates.

The outlook for this quarter and the year, however, fell short of expectations. The company’s conference call with analysts started at 4:30 pm, Eastern.

Q4 revenue was down 22%, year over year, at $182.2 million, beating the average $148 million estimate. A net loss of 18 cents per share was far bettern than the 39-cent loss analysts had been expecting.

Results were boosted by titles such as NBA 2K11, Top Spin 4, and Major League Baseball 2K11, the company said.

For the current quarter, the company projected revenue of $325 million to $375 million, and profit of breakeven to 10 cents per share. Analysts had been modeling $298.7 million and 14 cents per share.

Reviewing the company’s lineup, some titles have slipped in their release schedule as described back in February. For example, Duke Nukem Forever, originally scheduled for May 3rd, was pushed out (of course!) to June 10th, while Spec Ops: The Line, originally scheduled for “fiscal year 2012,” was pushed out to “first half fiscal 2013.”

For the full year ending in March of 2012, the company projects $1 billion to $1.1 billion in revenue, and EPS of 10 cents to 35 cents. That is below the $1.3 billion and $1.12 per share analysts have been modeling.

Take-Two said three key members of its Rockstart Games development team, Sam Houser, Dan Houser, and Leslie Benzies, had renewed their long-term employment agreements with Take-Two.

Article courtesy of Tech Trader Daily

Shares of video game maker Take-Two Interactive (TTWO) are up 3 cents at $16.13 down 35 cents, or 2%, at $15.75, after the stock was briefly halted in advance of its fiscal Q4 report, which easily beat estimates.

The outlook for this quarter and the year, however, fell short of expectations. The company’s conference call with analysts started at 4:30 pm, Eastern.

Q4 revenue was down 22%, year over year, at $182.2 million, beating the average $148 million estimate. A net loss of 18 cents per share was far bettern than the 39-cent loss analysts had been expecting.

Results were boosted by titles such as NBA 2K11, Top Spin 4, and Major League Baseball 2K11, the company said.

For the current quarter, the company projected revenue of $325 million to $375 million, and profit of breakeven to 10 cents per share. Analysts had been modeling $298.7 million and 14 cents per share.

Reviewing the company’s lineup, some titles have slipped in their release schedule as described back in February. For example, Duke Nukem Forever, originally scheduled for May 3rd, was pushed out (of course!) to June 10th, while Spec Ops: The Line, originally scheduled for “fiscal year 2012,” was pushed out to “first half fiscal 2013.”

For the full year ending in March of 2012, the company projects $1 billion to $1.1 billion in revenue, and EPS of 10 cents to 35 cents. That is below the $1.3 billion and $1.12 per share analysts have been modeling.

Take-Two said three key members of its Rockstart Games development team, Sam Houser, Dan Houser, and Leslie Benzies, had renewed their long-term employment agreements with Take-Two.

Article courtesy of Tech Trader Daily

TiVo (TIVO) this afternoon reported fiscal Q1 revenue ahead of estimates, and forecast the current quarter higher as well.

Revenue in the three months ended in April  fell 10% to $38.8 million, yielding EPS of $1.04. Excluding a $175.7 million payment, as part of the company’s settlement with Dish Network (DISH) and Echostar (SATS), announced May 2nd, the company would have had an operating loss of $36 million, versus the reported $139 million operating profit, or roughly 27 cents per share.

Analysts, on average, had been expecting $37.2 million and a net loss of 30 cents.

Net income of $139 million was the highest quarterly profit in the company’s history, TiVo said.

For the current quarter, the company sees revenue of $46 million to $48 million, ahead of the $42.75 million average estimate of analysts. Net loss is expected in a range of $25 million to $27 million, with adjusted Ebitda of $14 million to $16 million.

TiVo’s subscriber gross additions were 27,000 in the quarter, down from 33,000 a year earlier.  On a net basis, the company lost 88,000 subscribers, better than the year-earlier 96,000-subscriber drop. The company ended the quarter with 1.96 million subscribers, down from 2.51 million a year earlier. Average churn in the quarter rose from 2% a year earlier to 2.3%.

TiVo shares are up 5 cents, or half a point, at $9.46 in late trading, after rising by just as much during the regular session.

Article courtesy of Tech Trader Daily

Semiconductor equipment maker Applied Materials (AMAT) this afternoon reported fiscal Q2 revenue and earnings ahead of estimates but forecast the current quarter’s results to fall to a level less than expected.

Revenue in the three months ended in April rose 24%, year over year, to $2.86 billion, and were up 6% from Q1′s level, yielding EPS, on a non-GAAP basis, of 38 cents.

Analysts on average were expecting $2.77 billion and 37 cents.

For the current quarter, the company said revenue will fall 3% to 10%, which would be about  $2.57 billion to $2.77 billion. EPS is expected in a range of 31 cents to 37 cents.

Analysts have been modeling $2.79 billion and 37 cents.

CEO Mike Splinter said, “Near-term economic conditions have tempered our growth expectations,” but added that, “our outlook for the year remains strong driven by our customers’ plans to invest in the advanced technologies needed to meet growing demand for mobile devices and consumer electronics.”

Applied shares are down 32 cents, or 2%, at $13.39 in late trading.

Applied is in the process of acquiring equipment maker Varian Semiconductor (VSEA).

Applied’s conference call with analysts is coming up at 4:30 pm, Eastern, and you can the Webcast here.

Article courtesy of Tech Trader Daily

Semiconductor equipment maker Applied Materials (AMAT) this afternoon reported fiscal Q2 revenue and earnings ahead of estimates but forecast the current quarter’s results to fall to a level less than expected.

Revenue in the three months ended in April rose 24%, year over year, to $2.86 billion, and were up 6% from Q1′s level, yielding EPS, on a non-GAAP basis, of 38 cents.

Analysts on average were expecting $2.77 billion and 37 cents.

For the current quarter, the company said revenue will fall 3% to 10%, which would be about  $2.57 billion to $2.77 billion. EPS is expected in a range of 31 cents to 37 cents.

Analysts have been modeling $2.79 billion and 37 cents.

CEO Mike Splinter said, “Near-term economic conditions have tempered our growth expectations,” but added that, “our outlook for the year remains strong driven by our customers’ plans to invest in the advanced technologies needed to meet growing demand for mobile devices and consumer electronics.”

Applied shares are down 32 cents, or 2%, at $13.39 in late trading.

Applied is in the process of acquiring equipment maker Varian Semiconductor (VSEA).

Applied’s conference call with analysts is coming up at 4:30 pm, Eastern, and you can the Webcast here.

Article courtesy of Tech Trader Daily

Shares of software vendor Salesforce.com (CRM) are up $3.45, or 2.4%, at $148.75 after Morgan Stanley’s Adam Holt this morning raised his rating on the stock to Overweight from Equal Weight, with a $200 price target, writing that workloads on “cloud” computing facilities, such as the company’s “Force.com” online platform, is going to rise 50% per annum, compounded, through the next three years, based on Morgan Stanley’s survey of 300 IT executives.

Usage of cloud-based applications will increase from 51% of companies today to 80%, Holt says the data show.

Salesforce should be the biggest beneficiary, Holt thinks, and he believes consensus estimates for the company don’t reflect the rate of growth, instead modeling something like 20% cloud industry growth.

Based on an expectation Salesforce will garner an increasing share of the “software-as-a-service” pie, not to mention “platform-as-a-service” business, Holt raised his estimates for the company for fiscal 2013 and 2014. He sees $2.17 billion in revenue for this year, the same as his prior estimate, but for 2013 he sees revenue of $2.57 billion, from a prior estimate of $2.53 billion, and for 2014, he sees revenue of $3.23 billion, up from $3.082 billion previously.

That should produce non-GAAP EPS next year of $1.90, rather than the $1.80 he’d previously expected, and EPS of $2.43 in 2014, rather than the $2.31 he’d previously modeled. Holt models Salesforce earning $1.32 this year.

Holt’s $200 target is based on a 47 multiple of his projected free cash flow per share of $4.11 next year, which he suggests is a 1.3 times growth multiple.

Article courtesy of Tech Trader Daily

Shares of software vendor Salesforce.com (CRM) are up $3.45, or 2.4%, at $148.75 after Morgan Stanley’s Adam Holt this morning raised his rating on the stock to Overweight from Equal Weight, with a $200 price target, writing that workloads on “cloud” computing facilities, such as the company’s “Force.com” online platform, is going to rise 50% per annum, compounded, through the next three years, based on Morgan Stanley’s survey of 300 IT executives.

Usage of cloud-based applications will increase from 51% of companies today to 80%, Holt says the data show.

Salesforce should be the biggest beneficiary, Holt thinks, and he believes consensus estimates for the company don’t reflect the rate of growth, instead modeling something like 20% cloud industry growth.

Based on an expectation Salesforce will garner an increasing share of the “software-as-a-service” pie, not to mention “platform-as-a-service” business, Holt raised his estimates for the company for fiscal 2013 and 2014. He sees $2.17 billion in revenue for this year, the same as his prior estimate, but for 2013 he sees revenue of $2.57 billion, from a prior estimate of $2.53 billion, and for 2014, he sees revenue of $3.23 billion, up from $3.082 billion previously.

That should produce non-GAAP EPS next year of $1.90, rather than the $1.80 he’d previously expected, and EPS of $2.43 in 2014, rather than the $2.31 he’d previously modeled. Holt models Salesforce earning $1.32 this year.

Holt’s $200 target is based on a 47 multiple of his projected free cash flow per share of $4.11 next year, which he suggests is a 1.3 times growth multiple.

Article courtesy of Tech Trader Daily

Shares of software vendor Salesforce.com (CRM) are up $3.45, or 2.4%, at $148.75 after Morgan Stanley’s Adam Holt this morning raised his rating on the stock to Overweight from Equal Weight, with a $200 price target, writing that workloads on “cloud” computing facilities, such as the company’s “Force.com” online platform, is going to rise 50% per annum, compounded, through the next three years, based on Morgan Stanley’s survey of 300 IT executives.

Usage of cloud-based applications will increase from 51% of companies today to 80%, Holt says the data show.

Salesforce should be the biggest beneficiary, Holt thinks, and he believes consensus estimates for the company don’t reflect the rate of growth, instead modeling something like 20% cloud industry growth.

Based on an expectation Salesforce will garner an increasing share of the “software-as-a-service” pie, not to mention “platform-as-a-service” business, Holt raised his estimates for the company for fiscal 2013 and 2014. He sees $2.17 billion in revenue for this year, the same as his prior estimate, but for 2013 he sees revenue of $2.57 billion, from a prior estimate of $2.53 billion, and for 2014, he sees revenue of $3.23 billion, up from $3.082 billion previously.

That should produce non-GAAP EPS next year of $1.90, rather than the $1.80 he’d previously expected, and EPS of $2.43 in 2014, rather than the $2.31 he’d previously modeled. Holt models Salesforce earning $1.32 this year.

Holt’s $200 target is based on a 47 multiple of his projected free cash flow per share of $4.11 next year, which he suggests is a 1.3 times growth multiple.

Article courtesy of Tech Trader Daily

Shares of software vendor Salesforce.com (CRM) are up $3.45, or 2.4%, at $148.75 after Morgan Stanley’s Adam Holt this morning raised his rating on the stock to Overweight from Equal Weight, with a $200 price target, writing that workloads on “cloud” computing facilities, such as the company’s “Force.com” online platform, is going to rise 50% per annum, compounded, through the next three years, based on Morgan Stanley’s survey of 300 IT executives.

Usage of cloud-based applications will increase from 51% of companies today to 80%, Holt says the data show.

Salesforce should be the biggest beneficiary, Holt thinks, and he believes consensus estimates for the company don’t reflect the rate of growth, instead modeling something like 20% cloud industry growth.

Based on an expectation Salesforce will garner an increasing share of the “software-as-a-service” pie, not to mention “platform-as-a-service” business, Holt raised his estimates for the company for fiscal 2013 and 2014. He sees $2.17 billion in revenue for this year, the same as his prior estimate, but for 2013 he sees revenue of $2.57 billion, from a prior estimate of $2.53 billion, and for 2014, he sees revenue of $3.23 billion, up from $3.082 billion previously.

That should produce non-GAAP EPS next year of $1.90, rather than the $1.80 he’d previously expected, and EPS of $2.43 in 2014, rather than the $2.31 he’d previously modeled. Holt models Salesforce earning $1.32 this year.

Holt’s $200 target is based on a 47 multiple of his projected free cash flow per share of $4.11 next year, which he suggests is a 1.3 times growth multiple.

Article courtesy of Tech Trader Daily