Saturday, August 18, 2012

Largest USA Tech Companies Earnings Plunge, But Apple Still Dominates

Quarterly Net Income

The Largest USA Tech Companies have reported quarterly aggregate net income of $26.3 billion, which is lower than the prior quarter $33.9 billion. This is a sequential QoQ decrease of -$7.68 billion and -23%. Six of the ten companies reviewed reported a QoQ decrease in net income. The net decrease is not too unusual or unexpected as the second quarter of the calendar year is typically a slower financial performance on an annual cyclical basis. The largest sequential QoQ increases were Oracle (+$953 million) and IBM (+$816 million) and HP (+$125 million). The largest sequential QoQ decreases were by Microsoft (-$5.60 billion), Apple (-$2.80 billion), and Qualcomm (-$1.02 billion).

For the latest quarters reported, Apple continues dominating with an incredible $8.82 billion quarterly net income. Second was IBM at $3.88 billion and third was Oracle at $3.45 billion, combined less than half of Apple. The rest of the pack follows with #4 Intel at $2.83 billion, #5 Google at $2.79 billion, #6 Cisco at $2.17 billion, #7 HP at $1.59 billion, and #8 Qualcomm at $1.21 billion. Trailing are #9 Amazon at a mere $7 million and #10 Microsoft at a dismal net loss of -$492 million. I have included Amazon because of the Kindle Fire, streaming, cloud services, and the resulting competition with others listed. Apple comprises approximately 34% of the total quarterly net income of the 10 tech companies listed!

Return on Assets

The Largest USA Tech Companies have reported an average return on assets of +13.45%, a multi-quarter low and -1.13% decrease from the prior quarter of +14.58%. Eight of the ten companies reviewed reported decreases. Amazon and HP dragged the average down the most. The 2 sequential QoQ increases were Cisco (+0.24%) and IBM (+0.17%). The largest sequential QoQ decreases were Microsoft (-6.42%), Apple (-2.08%), and Amazon (-1.00%).

For the latest quarters reported, Best of Breed goes to Apple with a commanding and incredible lead of at +29.70% ROA. Apple is distantly followed by Intel (+17.61%), Qualcomm (+15.26%), and Google (+15.02%). Next are #5 Microsoft (+14.95%), #6 IBM (+14.30%), and #7 Oracle (+13.38%). Significantly lagging the field are #8 Cisco at +8.36% and #9 HP at a much lower +4.12%. Retail-oriented Amazon is last and #10 at a sinking +1.82%.

Updated through Amazon quarterly financial results reported 7-26-12
Next reports: Cisco (August 15), HP (August 22)


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