Watch Out for These 3 Earnings Reports
Jun 6th 2013 8:15PM
Updated Jun 7th 2013 1:00AM
The next earnings season is only a few weeks away. A number of companies have racked up important questions since their last report, and I'm looking forward to their upcoming updates. Here's a smattering of the most important, or intriguing, questions that I'm hoping to see answered fairly soon, culled from my regular tech sector beat
BlackBerry tops the list for me. The company formerly known as Research In Motion will report its first quarter, where its brand new BlackBerry 10 platform can make a meaningful impact on results. Fans of the company like to argue that the Z10 and Q10 handsets are selling like hotcakes, and some market reports will reinforce that opinion. Then again, other reports and analyst deep-dives into the handset flows come up with exactly the opposite conclusion.
Selling a ton of Z10 and Q10 smartphones is not an optional little bonus for BlackBerry. This is a do-or-die, make-or-break situation, and the company is in real trouble if these products don't perform. CEO Thorsten Heins expects to sell "tens of millions" of his new devices in 2013, including about 3.5 million in the May quarter.
I'm a skeptic, and would be very surprised to see BlackBerry's shares ever above January's $17.90 highs ever again. This is where the Canadians might get to prove me wrong.
BlackBerry even gets the party started early by reporting on June 28, which is about three weeks before the real bulk action begins in mid-July.
TIBCO Software also reports in the lull between big-volume earnings seasons, and is expected to drop a second-quarter update on June 20. This is a stock that I own, but Tibco has not been a smooth operator in recent quarters. I'd love to see an end to this rocky road.
It's been about a year since Tibco cut loose its head of North American sales, and announced a major reorganization of that division. And we're still waiting for a turnaround to this "disappointing" operation, in CEO Vivek Ranadive's own words. In the March report, CFO Murray Rhode once again told us that all is not well: "The Americas infrastructure business is clearly not back on track quite yet, but we have made and continue to make good progress against our plans," he said.
The next day, Tibco shares were suddenly 9.4% cheaper. The stock is still trading near 52-week and multi-year lows. If you bought Tibco near the end of 2010, you could have a break-even performance on your hands right now. Hardly exciting, and not what you'd expect out of a pioneer and leader in the booming market for Big Data specialists.
I'm hoping for a bad chapter in Tibco's history to be closed this month. Every quarter of underperforming sales teams leaves another few million of potential sales on the table.
And, of course, I'm on pins and needles for the next Netflix report. The digital video veteran reports second-quarter results on July 24, in the thick of the real earnings season, and there are plenty of questions to address.
How are Netflix's original shows doing? This will be the first full quarter with Kevin Spacey drama House of Cards, and horror thriller Hemlock Grove, in the catalog, and revived cult comedy Arrested Development scores about half a quarter of on-screen impact. All of these shows most likely attracted a large number of fresh customers; but were these temporary boosts or long-term subscribers in the making?
Based on whatever these early tries at original content are doing, will Netflix step up its production plans -- or maybe scale them down?
We've been told that another European market will jump on the Netflix bandwagon before 2013 is over. Will we learn anything new about the timetable, expansion plans for 2014 and beyond, or the identity of the next market?
Last year's July report crushed Netflix's already marked-down share prices, mostly due to a big misunderstanding about seasonal effects. I expect most of the questions above to get favorable responses, but I don't necessarily expect CEO Reed Hastings to spill all his beans in July. So it looks like a blend of strong results and limited strategic guidance, just like last year. The market reaction to a mix like that is wildly unpredictable. This quarter probably won't change the long-term story for Netflix investors, but there might be big price swing in the offing. Up or down is hard to tell. Stay on your toes, and prepare to get opportunistic.
The article Watch Out for These 3 Earnings Reports originally appeared on Fool.com.Fool contributor Anders Bylund owns shares of TIBCO Software and Netflix, but he holds no other position in any company mentioned. Check out Anders' bio and holdings or follow him on Twitter and Google+. The Motley Fool owns shares of Netflix. Motley Fool newsletter services have recommended buying shares of TIBCO Software and Netflix. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.
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