The Party Is Not Over Yet

Google



Results Dazzle



The search engine guru Google reported revenues of $1.6 bn for the quarter

ended September 30, 2005, up 96% compared to the third quarter of 2004, and up

14% compared to last quarter. Net income for the third quarter was $381 mn, as

compared to $343 mn in the second quarter, an increase of 11%. It's important

to note that this is traditionally a weak quarter before traffic picks up for

the holiday season. Google also introduced its instant messenger service with

voice services to rival Yahoo and MSN messengers. Analysts believe that

Internet-based advertising is likely to grow rapidly in the coming years at the

cost of print and broadcast advertising. It is estimated that while Internet

advertising comprises only 5% of adspent, consumers spend 20% of their time on

the Internet. Based on these trends some analysts have upped the target price of

Google for the yearend at around $450. Google currently trades at $339.

EMC



Solid Growth



The storage and information management major EMC announced excellent results

for the third quarter, driven by its expanding services business, expansion of

its mid-tier storage systems and its virtual infrastructure management software.

The revenues for the third quarter were $2.4 bn, 17% higher than the $2 bn

reported for the third quarter of 2004. Net income for the quarter was $422 mn,

including $106 mn from a tax-related benefit, compared with $218 mn reported for

the third quarter of 2004.

This growth was led by a systems revenue growth of 15% in the third quarter

compared with the year-ago quarter, to $1.1 bn. Software license and maintenance

revenues were up 16% to $865 mn, representing 37% of total revenues. Services

revenues, which have been the star of EMC's growth story, jumped 25% to reach

$402 mn. The future outlook, according to the management, remains strong, with

expected consolidated revenues for the fourth quarter of 2005 between $2.7 bn

and $2.7 bn, with full-year growth expected at 17% over the previous year

revenues. EMC also announced a definitive agreement to acquire Captiva, a

document imaging technology provider, for approximately $275 mn. This

acquisition will help the company to deliver solutions for input management and

image processing applications and form a part of the EMC's enterprise

archiving offerings. EMC currently trades at $13.7.

Motorola



Gains Market Share



Motorola announced strong performance for the third quarter ended September

30, 2005, led by the secular growth in cellphones as well as expanding global

wireless networks. The company reported sales of $9.4 bn, up by 26% over the

same quarter in the previous year. Net income, at 1.75 bn, was up by 265% on a

y-o-y basis. The marketshare of the company's mobile devices were up at 19% on

a global basis, up 5.5%, led by strongest ever shipment of 38.7 mn mobile units.

Sales from this segment were $5.6 bn, up 41% compared with the year-ago quarter.

The high growth was a result of a slew of new products launched in the recent

months, especially in the mobile video and mobile music product areas, which are

in demand both by new users and replacement markets. The network segment sales

were $1.6 bn, up 7% compared with the year-ago quarter. The segment continued to

do well with new sales to Alltel (USA), Optimus (Portugal) and SMART

Communications (Philippines). Government and enterprise mobility solutions

segment sales were $1.6 bn, up 4% compared with the year-ago quarter. Sales to

the enterprise and home segments were up 7% and 28%, respectively. The company's

outlook for the fourth quarter of 2005 is also buoyant, with an expectation of

revenues between $10.3 bn and $10.5 bn. The outlook for net income in the fourth

quarter of 2005 is around $812 mn. Currently, Motorola trades at $20.7.

IBM



Coming out of the Blues



IBM results beat Street estimates by a considerable margin for the third

quarter ended 30th September 2005. While revenues were down compared to previous

year quarters, the results were not strictly comparable due to the divestment of

the PC business by the company. Revenues stood at $21.5 bn, down 8% over the

previous year, but up 4% considering the divested PC business. Net income stood

at $1.5 bn, down 2.5% over the same period last year, largely impacted by the

$525 mn tax charge for repatriating cash earned overseas. The company sales were

down 5% in the Americas for the third-quarter with revenues at $9.6 bn, while

those from Europe/Middle East/Africa were at $6.9 bn, down 6%. Asia-Pacific

revenues decreased 17% while OEM revenues were $814 mn, up 12% compared with the

2004 third quarter. Without the PC business, revenues increased in three of its

key industry segments: Sales units in the third-quarter of 2005 was led by good

growth in the public and distribution sectors as well as the SMB segment. Its

revenues for business performance transformation services grew over 35% in the

quarter, while those from global services increased 3%, to reach $11.7 bn in the

third quarter. Hardware revenues without the PC business increased 7% with

growth coming from the systems and technology group. Revenues from software

products were $3.8 bn, an increase of 5% compared with the third quarter of

2004. Revenues from IBM's middleware brands, which include WebSphere, DB2,

Tivoli, Lotus and Rational products, were $3.0 bn, up 6% versus the third

quarter of 2004. Operating systems revenues decreased 2% to $588 mn compared

with the prior-year quarter. IBM shares change hands at $83.3.

Intel



Riding the Tech Growth



Intel Corporation announced record revenue of $10 bn for the third quarter,

up 18% y-o-y and up 8% q-o-q, led by the strong growth in PC shipments and

overall buoyant environment in the technology sector. Net income was $2 bn, up

5% y-o-y and down 2% q-o-q. Among the key events of this quarter, Intel and

MicroUnity agreed to resolve their patent infringement case. As a result, Intel

will pay $300 mn to MicroUnity to settle the long-standing dispute. The gross

margin percentage was 59.7%, including the impact of the MicroUnity legal

settlement. The growth was led by a record microprocessor and flash memory

units. Process units for wireless products including PDAs and cellphones also

inched higher on face of global demand. It expects revenues in the fourth

quarter to be between $10.2 bn and $10.8 bn. Intel shares currently trade at

$24.3.