Megabuyte - Technology sector intelligence

Vodafone’s Q1 IMS shows the company reporting improving organic revenue trends in most geographic markets, and across voice, messaging and data, and even a return to organic growth in the UK and Germany. Overall, the company reported its first quarter of organic growth since the onset of recession, thus matching the company’s official revenue outlook for the full year. Despite these improving trends, EBITDA margins are still declining, and free cashflow is down 7% year on year, despite a 12% cut in capex. The return to growth is welcome, but serious challenges remain. Read more in Newswire Plus.

Microsoft opens window on good Q4

Technology giant Microsoft posted its fourth quarter results late night that were ahead of market expectations. Q4 2010 revenue was up 22% to $16.04bn, taking the full year revenue to $62.5bn. Backed by strong demand for Windows 7, the windows division posted 43.5% growth, reaching $4.5bn. Also, recently launched Office 2010 brought the business division back on track with revenue reaching $5.25bn up by 15%. Other segments including server & tools, entertainment & devices and online services also posted revenue growth of 13.7%, 27.3% and 12.8% reaching $4bn, $1.6bn and $565mn respectively. See Newswire Plus for more.

Nokia’s never-ending decline

Nokia’s Q2 results show the same sad story; headline revenues up marginally but declining in constant currency terms, and relentless declines in profitability margins, market share and average selling prices. Headline revenues grew 3% to €6.7bn, but fell 4% in constant currency terms, with Nokia Siemens Networks down 5% (11% constant currency) to €3.04bn, and Devices up 3.2% (but down 2% constant currency) to €6.8bn. Meanwhile, operating profit fell 14% to €660m, representing a 1.2pp decline in margin to 6.6%. With NSN barely profitable (1% margin), most of the damage was done by the Device division, where the margin fell 2.7pp to 9.5%.  The decline in Device margins has led the company to lower its full year guidance from 11-13% margin to 10-11% margin. Newswire Plus has more.

Velti advertises 1H revenues of $40m

Mobile advertising specialist Velti has said that 1st half revenues will be in excess of $40m, aided by new client wins, roll out of new services etc. This represents a c25% increase on last year’s 1H $32m. If one assumes the same one third, two thirds split as last year (there are no forecasts in the market), Velti is on track for c$120m revenues, up a third on 2009. This would represent a significant slowdown in growth from the reported 82% for 2009. After announcing its intention to list on NASDAQ (Premium Plus readers see here), the shares jumped 60% to 510p, but have now come back to 403p. At that level, Velti would still be on c2.3x revenues, a far cry from the 7x paid by Google for Admob, but still a valuation that requires continued strong growth. 

Alterian in-line

Alterian, the marketing and content management software provider, has issued an in-line update for Q1, though notes that this quarter represents a relatively small proportion of full year revenues. The company also notes the challenging economic environment but believes that its efforts leave it well positioned. As we noted at the time of the full year results, market expectations for this year might be a stretch (Premium Plus readers see here) but Alterian's H2 weighting means that it is too early to say whether our concerns are well founded.

Digital Barriers makes second acquisition

Digital Barriers, Tom Black’s security services roll-up, has announced its second acquisition, following that of SAL in March (Premium Plus readers see here). The company is buying the Solutions division of Overtis Group Limited for £3.20 million in cash. Overtis Solutions is described as a UK-based specialist provider of integrated security solutions used in the protection of high value physical, human and information assets on a global basis held by high risk government departments, public sector bodies and major corporations, ie anti-terrorism. Read more in Newswire Plus.

Zamano reformulates its strategy

Mobile content provider Zamano has put out an update on the first half, which as regular readers will know has been impacted particularly by new regulations in Ireland (Premium Plus readers seehere). The company expects to report revenues of €8.8m and EBITDA of €1m, against €13.3m and €2.2m last year.  Zamano has reformulated its strategy, focussing on helping content providers sell content to end users, and pulling away from content generation and sub-scale geographies, which is expected to stabilise the business during the second half. Read more in Newswire Plus.