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And if this week's strong news from bellwethers IBM [IBM
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], Intel [INTC
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] and Google [GOOG
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] is any indication, next week should be pretty good indeed. Too much of a reach, you ask? Maybe, but consider some of the key trends we're seeing from this week's numbers and use them against earnings news coming next week:
First, IBM sees services and bookings very strong, software sales about $200 million ahead of expectations, and the company is raising full year earnings per share to $8.50 after raising EPS to $8.25 just a few weeks before. Intel raises margin expectations in the current quarter by a point and full year by two points. Intel's CFO Stacy Smith tells me he sees no signs of a slowdown, either domestically or globally.
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And overseas sales, where Intel gets better than 75 percent of revenue is strong. Oh, and just this week, market research firm IDC says first quarter PC sales dramatically exceeded expectations, showing strength where no one really expected it. All of that bodes extremely well for Microsoft [MSFT
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] , which also is tracking better than expected Xbox 360 sales in March, according to NPD. I'll do a more formal earnings preview for all these companies, but take these trends to heart. Microsoft could be in a very good position.
Same goes for Apple Inc., [AAPL
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] again for many of the same reasons listed above, particularly the IDC and Intel news. Apple is now a Top 10 customer for Intel and almost every analyst I'm talking to is following what appears to be better-than-expected Mac sales. Sure there's noise about iPhone and the perceived iPod slowdown, but as I've written before, ad nauseum, this year is the year of the Mac, and growth on this platform is exponentially better than anything Dell [DELL
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] or Hewlett-Packard [HPQ
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] has been seeing, and there's no indication that the trend has reversed, or slowed. In fact, if anything, analysts seem to think it's merely gaining momentum.
Yahoo's [YHOO
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] earnings will generate interest if only because they'll give us a better idea of whether Microsoft might raise its bid. If Yahoo disappoints--few think they will--it could give ammunition to Microsoft to shave some money from its offer. If Yahoo dramatically beats--few they will--it could embolden Yahoo's board to hold out for a better deal. Instead, most are expecting an in line quarter, with the wild card being that a final deal between Yahoo and Microsoft will be announced right before, or right after Yahoo releases earnings.
An in-line quarter is also expected from Amazon [AMZN
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] , but eBay's numbers could make Amazon's earnings interesting. Payments at eBay [EBAY
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] were up, thanks to PayPal, and that indicates online sales strength, even though eBay's core auction business and new users slowed to a crawl. The question for investors: did customers jump ship and head to Amazon instead?
Rest up, another busy week for tech investors is ahead.
Questions? Comments?
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