27
Oct

The earnings of tech companies and what it all means

Today’s blog post is an interesting piece that has been sent in by a guest blogger, and sheds light on financial aspects going on within the industry.

The next week sees some hugely relevant tech companies announce their earnings: Apple, Twitter, Google and Facebook. A really exciting time to see how they are performing, and giving us a sense on who is coming out on top, and perhaps more importantly what the future will look like.

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Estimates are that Apple is likely to report $46.9bn revenue for the quarter, and it’s first annual revenue drop since 2001, what with iPhone sales declining over the past year and competition from Samsung and others. This and next quarter though, Samsung’s recall of around 13 million Note 7 devices will come as a Christmas present for Tim Cook’s iPhone 7 revenues. For example if just 25% of the recalled units converted to iPhone sales ($600 each), it would see an extra $1.9 billion revenue.

Increasing talks of Twitter acquisition interest from Walt Disney Co, Alphabet Inc (google) and Salesforce.com Inc were a non-event for the company and it didn’t help their share price during October. Their Q3 revenues are estimated around $605m (+6.3% on Q3 2015) while they attempt to stabilize advertiser demand and user stats. Twitter R&D spend is around 30% of revenue and this is likely to be focused on their video strategy to keep up with competitors. The Netflix CEO himself said last week, after announcing year on year Q3 revenue increase of 31% “we worry about Facebook, Snapchat , Youtube” indicating how important video growth might be.

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