Microsoft Earnings Breakdown, Plus, The Latest Investigation
Stocks are mixed as traders pocketed yesterday’s gains as the busiest week of
the reporting season winds up. Economic
reports showed that durable goods orders leaped 3.4%, much higher than the 0.7%
economists had estimated; demand was strong for a broad array of products.
Xerox
(
XRX |
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PowerRating) fell sharply despite reporting a strong profit of $248
million. The company had strong sales of color systems and office digital
products with revenue at $3.8 billion.
Microsoft
(
MSFT |
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PowerRating)
posted earnings that beat expectation, with sales of $9.18 billion and earnings
fell to $1.32 billion from $2.14 billion a year ago. Xbox sales rose 30% and its
deferred revenue balance was lower to $7.5 billion. The company has a $56.4
billion cash — or $5.17/share — balance and said would pay out a larger
dividend or increase stock buybacks before its July analyst meeting. For the
next quarter, the company expects earnings to reach 28 cents with sales expected
to exceed $8.9 billion. For 2005, the company guided lower, expecting $1.17 a
share with 4% revenue growth rate.
New York Attorney General
Eliot Spitzer is now investigating fees charged by insurance brokers;
specifically whether there is a conflict of interest involved in paying
commissions to sell particular insurer’s products.
| Dow | -23.78 |
10437.32 |
| S&P 500 |
-2.72 | 1137.21 |
| Nasdaq | +7.24 | 2040.11 |
The day’s leading sectors are Computer
Technology
(
XCI.X |
Quote |
Chart |
News |
PowerRating) + 1.50%, Semis
(
SOX.X |
Quote |
Chart |
News |
PowerRating) +0.87%,
Telecoms
(
XTC.X |
Quote |
Chart |
News |
PowerRating) +0.12%
Weak today are Airlines
(
XAL.X |
Quote |
Chart |
News |
PowerRating) -3.20%, Internet
(
ECM.X |
Quote |
Chart |
News |
PowerRating) +0.36%,
Economic news releases today a
sharp increase in durable goods order of 3.4%.
10-year Notes are -190
at 110 255
The dollar
is +0.40 at 91.50
Gold is +4.00 at 394.00
Crude Oil is -0.23 at
36.48
Volume is 690,000,000 on
the NYSE, and 978,000,000 on the Nasdaq.
Market breadth is mixed.
| NYSE | Issues | |
| Advancing | 870 | Up Vol 228 |
| Declining | 2273 | Down Vol 431 |
| Ratio | 2.61 | 1.94 |
| Nasdaq |
||
| Advancing |
1172 | Up Vol 619 |
| Declining |
1840 | Down Vol 433 |
| Ratio | 1.63 | 1.44 |
Top Dow stocks are:
Microsoft
(
MSFT |
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PowerRating),
+6.01% at 27.58, Intel
(
INTC |
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PowerRating), +3.27% at 27.33, General Motors
(
GM |
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News |
PowerRating) +0.84% at 49.25, WalMart
(
WMT |
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Chart |
News |
PowerRating), +0.53% at 58.93.
Stocks in the news:
Broadcom
(
BRCM |
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News |
PowerRating) reported
earnings of $39.9 with revenue up 20% to $573.4 million.
Scientific-Atlanta’s
(
SFA |
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News |
PowerRating) profit
more than doubled to $54 million on much strong DVR set-top box sales with
revenue up 14% to $437 million.
Amazon
(
AMZN |
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Chart |
News |
PowerRating) reported earnings
of $111 million with sales up 41%, well ahead of analysts’ consensus. Sales grew
to $1.53 billion and is expected to reach $1.40 billion for the next quarter.
Schlumberger
(
SLB |
Quote |
Chart |
News |
PowerRating) was lower
after posting income of $220.3 million on revenue of $3.02 million as it
reported strength in its oilfields around the globe.
Brice Wightman
bricew@tradingmarkets.com