Global semiconductor sales rose 0.4% in Q1 from Q2, the Semiconductor Industry Association said this morning, an increase the group called “very encouraging” for the industry, and proof chips are “a force driving the U.S. economy forward and out of the recent recession.”

Sales of $25.26 billion in the quarter represent an 8.6% increase from the year-earlier level, the SIA said. That level of growth is, of course, well down from the 60%-plus growth in the year-earlier quarter after the projected drop during the recession. Chip sales rose 2.5% in March from April’s level.

Article courtesy of Tech Trader Daily

Shares of Avnet (AVT) were off 0.4% to a recent $36.08 despite the firm’s beat and raise quarter.

For the third quarter, Avnet said it earned $1.10 a share, compared to 76 cents a share in the year-ago period. Revenue grew to $6.71 billion.

Analysts were expecting the company to earn 99 cents a share on revenue of $6.31 billion.

For the fourth quarter, Avnet guided for $1.10-$1.22 a share, on revenue of $6.6 billion to $7.3 billion. Both beat consensus of $1.04 EPS and revenue of $6.5 billion.

Barrons.com spoke with CEO Roy Vallee who says it was a good quarter that “hit on nearly all cylinders” and that he sees the stock’s weakness today as a result of general softness in the semiconductors (as about half of Avnet’s overall revenue comes from the industry).

Vallee says that the impact of the Japanese earthquake is at this point too difficult to quantify. “Japan has a big impact on the technology supply chain as a consumer, a producer of goods, and a producer of raw materials that they sell to other producers all over the world. We’re working closely with all our suppliers to understand what the impact will be down to the part level, but we don’t have a good view yet. However, at this point we don’t think there is going to be a significant impact on the June quarter.”

Going forward, he thinks the company’s free cash flow will be a driver for the stock: “We just put up our fourth quarter in a row of roughly 40% year-over-year growth, and when we grow that rapidly, we can find ourselves with negative cash flow, and that was true for the quarters prior to this last quarter. We’ve turned the corner now, where the earnings growth overtook the revenue growth, and we were able to generate $188 million in cash flow from operations; as wel look forward, we expect that cash flow to stay nicely positive.

“The key [takeaway from the quarter] for us is that we have very strong revenue in both of our businesses [electronics marketing and technology solutions], in all regions of the world, and technology really seems to be leading the global economic recovery. Within that, Avnet is growing faster than the tech industry, including investments we’ve made in high growth markets like Latin America, Eastern Europe, the Middle East and Asia; so we’ve created an exciting growth profile. We’re putting up record EPS [results] while making these investments to increase our exposure to high growth markets, so there are parts of the portfolio that aren’t even contributing to margins, returns and profits in the way they will as we scale up.”

Article courtesy of Tech Trader Daily

Shares of Baidu.com (BIDU) were up 1% in recent premarket trading following the Chinese search engine’s first-quarter report.

Baidu said it earned 1.07 billion yuan ($164.3 million), up from 480.5 million yuan in the year-ago period. That result was in line with the average 1.04 billion yuan forecast from analysts polled by Dow Jones Newswires.

Earnings per American depositary share were 3.06 yuan (47 U.S. cents) in the first quarter, up from 1.38 yuan a year earlier, compared to the consensus of 2.97 yuan per ADS.

Revenue grew to 2.44 billion yuan from 1.29 billion yuan, again in line with estimates of 2.45 billion yuan.

Baidu projected revenue in the second quarter of 3.23 billion yuan to 3.3 billion, above the 3.07 billion yuan average forecast.

Morgan Stanley analyst Richard Ji and his team maintained their equal weight rating and $150 price target on the stock, noting that they liked the increase in paying customers, growing second quarter sales and Baidu’s new initiatives. However, they were concerned with accelerating bandwidth costs.  “While Baidu, as a dominant paid search leader in China, is benefiting from the robust advertising demand from e-commerce players, we believe this has largely been priced in.”

Think Equity analyst Aaron Kessler maintained a Buy rating and $175 price target on the stock, touting the margin expansion, strong business momentum and above-consensus second quarter guidance. However, consumer adds were below his estimates.

Stifel Nicolaus analyst George Askew raised his price target to $172 from $144 on the earnings, noting that active online marketing customers (+24.0%) and revenue per customer (+51.8%) drove growth.

China International Capital analyst Jin Yi maintained a Buy rating and raised Baidu.com’s price target to $160 from $142. “We expect Baidu to maintain its leading position in PC search, gain momentum in mobile search, and capitalize on China’s e-commerce and online video growth. Box computing may further strengthen Baidu’s leading position as an integrated online platform.We recognize valuation bubbles are emerging for China’s internet companies both in the primary and secondary market. On one hand, Baidu, as the traffic center, is well positioned to absorb money swarming into the industry, and on the other hand its valuation is not very stretched, given the strong growth visibility for the next several years. Baidu remains one of our top picks.”

Article courtesy of Tech Trader Daily

Shares of RightNow Technologies (RNOW) were flat in recent after hours trading, even as the company reported better-than-expected earnings for the first quarter.

The software and cloud computing firm said diluted earnings per share came in at 4 cents, while non-GAAP diluted earnings were 10 cents a share, compared  7 cents in the year-ago period and 8 cents analysts had forecast. Revenue rose to $52.3 million, squeaking past the consensus of $52.1 million.

For the second quarter, RightNow sees earnings of 12 cents a share, a penny ahead of estimates, on $54 million in revenue, in-line with analysts’ forecasts. Full year revenue estimates of $226 million were also just ahead of the consensus.

The company said that new and recurring business came from companies including Activision (ATVI),  Cabela‘s (CAB) , CyberDefender (CYDE), DeVry (DV), Electronic Arts (ERTS), Ellie Mae (ELLI), Equifax (EXF), and Logitech (LOGI), among others.

Barrons.com spoke with CEO Greg Gianforte after the earnings release. He says the company’s quarter was very solid, with recurring revenue growth–”the best indicator in the industry”–up 27%. He’s not concerned about the market’s tepid reaction: “We’re one of the fastest growing cloud application companies in the industry…and the stock is up more than 75% in the last year, so a little adjustment [in the price after hours] isn’t a concern in light of the full year performance.”

Despite the stock’s run, he is also optimistic that the shares will continue to grow going foward, given the large addressable business-to-consumer market. (RightNow helps large companies reach out to consumers and improve their experiences over web, social and contact center platforms.) “I’ve done over 90 individual customer visits this year to big companies from DirecTV to Nike, and what they’re telling us is that consumers are getting more frustrated,” Gianforte says.  “The core differentiation [between large consumer companies] is tied to the experience they deliver to customers, and they must do this over new emerging social and mobile channels, as well as contact centers. To do that piecemeal leaves an empty taste in consumers’ mouths. So that’s the primary driver of our business. We realized we’ve spent 13 years investing in solutions, and there is massive market opportunity, so we’re going to push the accelerator down [on sales and distribution] all while expanding operating margins. I believe the recognition the stock is getting in the market is tied to that continuing top line growth.”

Of course, cloud computing and customer relationship management (CRM) is a crowded field, and RightNow has larger competitors, like Oracle (ORLC) and Salesforce.com (CRM).  However, Gianforte notes that the firm’s services are unique in the industry: “Oracle continues to use an outdated model. They have everything [set up for] on-premise deployment, they sell perpetual licenses, they have not embraced the cloud. Because we do everything on the cloud, our system is going faster and costs less to own, so that’s a significant advantage. Companies like Oracle and Salesforece.com have a more traditional approach to CRMt; they have focused primarily on internal improvements, making employees inside a company more efficient, while we make consumers more effective. That’s why we focus on consumer experience, it’s a bigger market than traditional CRM, and it includes components that aren’t even available from other vendors.”

Article courtesy of Tech Trader Daily

Financiers Switch To GOP (WSJ)
Daniel Loeb, founder of Third Point LLC, was one of the biggest Obama fund-raisers in 2008, rounding up $200,000 for him, according to campaign-finance records. In the decade prior, Mr. Loeb and his wife donated $250,000 to Democrats and less than $10,000 to Republicans. But since Mr. Obama’s inauguration, Mr. Loeb has given $468,000 to Republican candidates and the GOP, and just $8,000 to Democrats. Hedge-fund kings have feelings, too, and the president appears to have hurt them…Mr. Loeb is part of a shift in political allegiance within the world of hedge funds that also includes such big names as Steven Cohen’s SAC Capital Advisors and Kenneth Griffin’s Citadel Investment Group. Managers and employees of hedge funds directed a majority of their contributions to the GOP in the 2009-2010 election season, a pattern not seen since 1996, when the industry was much smaller.

UBS Attracts Highest Inflows Since 2007 as Profit Tops Estimates (Bloomberg)
UBS rose as much as 6.1 percent in Swiss trading, the biggest gain since July, after wealth management and retail clients added a net 16.7 billion francs ($19 billion), more than double the estimate of analysts surveyed by Bloomberg. Net income was 1.81 billion francs, topping the 1.69 billion-franc forecast of analysts…“The main thing is they’re having inflows again, and that’s good,” said Dirk Becker, a Frankfurt-based analyst at Kepler Capital Markets. “The investment bank will remain a construction site for UBS for a while.”

Qaddafi’s Money Man in Vienna Loses Funds With London Friends (Bloomberg)
As Muammar Qaddafi’s forces strafed crowds of protesters in Tripoli with automatic gunfire on Feb. 21, the dictator’s money manager fled the city in a car to the airport to escape the violence. With phone lines and Internet connections down, Mustafa Zarti, vice chairman of Libya’s $65 billion sovereign-wealth fund, couldn’t buy an airline ticket in advance. As mobs of travelers at the airport jostled for seats on packed flights, Zarti scored a spot in business class on Austrian Airlines and flew to Vienna, Bloomberg Markets magazine reports in its June issue. “It was catastrophic that day,” Zarti says. “I’m very sad for Libya.”

Boehner opens door to cutting U.S. oil tax breaks (Reuters)
“It’s certainly something we should be looking at,” Boehner said in an ABC News interview. “We’re in a time when the federal government’s short on revenues. They ought to be paying their fair share.” “Everybody wants to go after the oil companies and frankly, they’ve got some part of this to blame,” he said.

Biggest Banks Beating Estimates Can’t Hide 13% Drop in Revenue (Bloomberg)
“Loans still make up half of bank revenues and loan growth is negative,” Brian Foran and Glenn Schorr, analysts at Nomura Holdings Inc. in New York, wrote in an April 14 note. “We have spent the last few weeks on the road visiting investors. The overwhelming feedback on banks has been ‘Why bother?’”

NY Jurors Can’t See Graphics Again In Insider Case (BusinessWeek)
The jurors at the trial of Raj Rajaratnam began working at midday Monday after a federal judge in Manhattan described the law they must follow. They ended four hours later and will resume Tuesday. They asked to see defense exhibits they didn’t know they already had in binders and graphs prosecutors showed during closings but they can’t see again because they’re not exhibits.

NYSE Merger Plan Tunes Out Big Board Rules (Dealbook)
Without so much as having a brief meeting or discussion with Nasdaq and ICE on their bid — which offered over 13 percent more than Deutsche Börse’s bid — the board of NYSE Euronext declared the offer “clearly not in the best interests of our shareholders.” How could the board determine that without even having a conversation?

HSBC to close retail operations in Russia (FT)
“It’s a difficult market in Russia. You can’t just come in and say, ‘I’m HSBC’, ” said an executive at a rival Russian bank.

Fight Heats Up For Lehman Remains (WSJ)
A three-way battle over the remnants of Lehman Brothers Holdings Inc. is coming to a head, as the defunct investment bank’s estate fights with big-name hedge funds like Paulson & Co and Lehman’s former archrival Goldman Sachs. over how to divvy up $61 billion in assets.

If Greece Acts Quickly, Crisis Could Be Averted (CNBC)
”The longer Greece waits before, the more the plan will cost…and the greater the odds of a haircut for bondholders,” Carl Weinberg explained.

Madoff Said Picower May Have Suspected Fraud, Henriques Writes (Bloomberg)
Madoff, serving a 150-year term for the largest Ponzi scheme in history, said in a prison interview that Picower could have figured out the fraud at Bernard L. Madoff Investment Securities LLC, according to the book. Picower invested $620 million and withdrew $7.8 billion before Madoff confessed to his brother and two sons in December 2008. Henriques asked Madoff who knew of the fraud. “Picower was the only one that might have,” Madoff said. “I mean how could he not?”

Human Cannonball Dies After Safety Net Fails (Sky News)
The accident happened during a show put on by Scott May’s Daredevil Stunt Show at the Kent County Showground in Detling at about 3.30pm on Monday.
The 23-year-old man was flown by air ambulance to Maidstone Hospital, but later died from his injuries.

Article courtesy of Dealbreaker

One of these days, there will be an “internet of things,” or once-dumb appliances and gadgets smartened up with chips and internet connectivity. Wireless chip maker Atheros Communications believes that day is not so far away.

Today, the San Jose maker of wireless chips is announcing an initiative that will make it easy for internet-aware home appliances to transfer data over electrical wires in the home to a user’s web-connected devices and to the smart grid. This initiative is one of the enabling steps to putting smart appliances on the grid without spending money to wire them with traditional Ethernet-based wiring.

“There will be 100 internet-connected devices per home one day,” said Adam Lapede, senior director of internet of things technology at Atheros, in an interview.

It’s kind of a pipe dream, but it’s a big one that is shared by a lot of companies that want to make everyday appliances smarter, more useful in providing data feedback, and more energy efficient. Atheros has chosen to connect the smart appliances using the HomePlug Green Phy, or a version of the HomePlug AV standard for transferring internet data over home electrical wires.

Atheros, which is in the process of being acquired by Qualcomm, designed the technology so that smart appliances can transfer or receive internet data without consuming a lot of power or taking much of the available internet bandwidth of the home wires, Lapede said. Once connected, these devices will be readable, recognizable, locatable, and addressable. It means they will be able to provide information such as how much energy they are consuming and when is the best time to use them to preserve energy.

“We need to figure out how to reduce the demand during peak usage and improve our efficiency,” Lapede said.

Lapede said the cost of putting internet connectivity is getting smaller and smaller. Atheros, which makes Wi-Fi chips and other related technology, hopes to drive the costs of the connectivity chips even lower by making them in huge quantities and standardizing them across the industry

With the HomePlug Green Phy technology, Atheros is asking software developers to begin developing applications that will use its chip hardware in the future for the internet of things vision. As envisioned, the technology will be integrated into stand-alone gateway devices or into the appliances themselves. It will allow the transfer of data from device to device at a rate of 10 megabits a second or more. That will happen seamlessly, without the need to translate the data from one format to another.

Lapede said that applications will have to use built-in encryption and other security methods to ensure that a neighbor won’t be able to hack another one across the smart grid. Lapede said that the power line technology has rivals, but he believes it is the best way to reach all of the appliances in the home. And while HomePlug AV has a number of rivals, he says chips based on the standard have shipped in the tens of millions of units worldwide. So it makes sense to adapt HomePlug for the internet of things.

Once the applications have been defined and requirements set, Atheros will design chips based on the standard and ship them to customers in the coming years.

“We expect to see traction in 2012,” Lapede said.

Tags: HomePlug AV, HomePlug Green Phy

Companies: Atheros Communications

People: Adam Lapede

Article courtesy of VentureBeat » deals

Fairchild Semiconductor International (FCS) was falling 2 cents to $18.29 in recent trading after the company yesterday forecast second quarter sales growth of 3% to 5%, ahead of analysts’ consensus.

The stock lost more than 4% yesterday on the news however, as the guidance didn’t factor in risks related to the March 11 Japanese earthquake, which has caused disruptions throughout the industry.

However, Citi analyst Terence Whalen reiterated his Buy rating on the stock noting that  that the company’s “lack of elucidation, taken together with FCS’s 75%+ run since Oct-10, created a post-results pull-back that we view as a buying opportunity. It’s worth noting that FCS’s fundamentals remain intact — solid revenue guidance is fully covered by backlog and improving product mix is helping GM.”

He also raised his target price by $4, to $26.

“FCS has no production in Japan and its sales to Japan was less than 4% in 1Q11, so direct risks on both supply and demand are minimal,” he wrote in a research note.”But indirect risks still exist if FCS’s customers were impacted by component shortages. On the flip side, FCS does see the potential for an increase in orders from MOSFET and power module customers as they are concerned on supply from Japanese competitors. Because there is still very limited visibility on indirect effects on both supply and demand, FCS didn’t include any related puts or takes in its 2Q11 guidance.”

Article courtesy of Tech Trader Daily

Infosys (INFY) is tumbling this morning after the company’s earnings forecast came in well below consensus. Shares of the IT outsourcer are down 13%, or $9.57, to $63.44 this morning.

The company expects first-quarter EPS of 62 cents to 63 cents versus Wall Street’s existing consensus of 69 cents. For fiscal 2012, Infosys guided to EPS of $2.83 to $2.88. The Street had been expecting $3.10. Margins are clearly coming under pressure, because Infosys’ FY2012 revenue guidance of $1.643 billion to $1.659 billion was in line with Wall Street’s expectations.

Infosys’ fourth-quarter results, reported early today, were in line with estimates. In the company’s press release, CEO S. Gopalakrishnan said, “We expect the demand environment to be normal this year for the industry.”

Article courtesy of Tech Trader Daily

Up until 2009, Glen Stewart was the CEO of The International Banking Corp. The bank failed that year and while other chief executives might’ve spent a lot of timing moping around the house, wondering if they’d ever get a job in this industry again, Stewart probably remained in high-spirits, knowing that he had a fallback career in the movie-making biz, having produced ‘Lesbian Vampire Killers’ just a few months prior. Unfortunately, if there are plans to release the entire trilogy, they’ll have to be put on hold, as Stewart now must deal with the lawsuit filed against him last week by Ahmed Hamad Algosaibi & Bros, who claim the banker/auteur a) fraudulently obtained loans and b) was running a fake bank.

The lawsuit was filed by Ahmed Hamad Algosaibi & Bros, a firm run by a wealthy and influential Saudi family. It contends that Stewart ran what was essentially a ‘sham bank’ that collected more than $10billion in loans from financial institutions. ‘Mr Stewart knew that it had no real customers, having played a central role in fabricating and documenting a portfolio of dummy borrowers to make it appear TIBC had real banking business,’ and also falsely claimed that the prominent Algosaibi firm controlled the bank, according to the lawsuit. The company accuses Stewart of fraud, conspiracy, aiding and abetting fraud, aiding and abetting breach of fiduciary duty, and unjust enrichment. It seeks $9.2billion in damages.

TIBC actually was controlled by al-Sanea, but ‘the illusion of Algobaisi family backing was crucial to TIBC’s ability to borrow in the international financial markets,’ the suit contends.
The money was siphoned off to al-Sanea and his Saad group of companies while Stewart collected about $100million through various phony payments and commissions, the suit claims.

Stewart apparently is not sweating this thing, and told reporters that the Algobaisi family is “lying through its teeth.”

Saudi Firm Sues American Over Alleged $10 Billion Fraud [BusinessWeek]
Former Banker Sued For Fraud [DM]

Article courtesy of Dealbreaker

Limos.com, an online marketplace for limousine services, announced this morning that it has raised $10 million in funding.

Limos.com, which provides online bookings and consumer reviews, has become the largest marketplace for limo services, the company said. The company pre-screens all Limo operators and makes it mandatory that they are covered by $10 million in insurance. Limos.com has established partnerships with notable companies including OpenTable and Ticketmaster.

Says T.J. Clark, Limos.com President & CEO, “After our experience at Hotwire.com, we couldn’t understand why there wasn’t an easy way to search, compare and book car services online, which has been so popular for hotel rooms and airfares.”

Although the industry is highly fragmented, ground transportation in the U.S. is a $36 billion industry, with less than 5 percent of reservations currently made online.

The round of funding came from venture capital firm Austin Ventures. Austin Ventures Partners Mike Dodd and John Thornton will join the Limos.com board.

Limos.com, which was found in 2007 by former Hotwire.com employees, had previously raised $5M in funding from Canal Partners.

Tags: Limo.com, online marketplace

Companies: Limos.com

People: John Thornton, Mike Dodd, T.J. Clark

Article courtesy of VentureBeat » deals