SAN FRANCISCO (Reuters) - Web search leader Google Inc. (GOOG) Thursday posted an industry-leading 110 percent rise in quarterly profits that showed the company dodged the slowing growth trend that has hurt rivals Yahoo (YHOO) and eBay (EBAY).
Second-quarter net income rose to $721 million, or $2.33 per diluted share, compared with the year-earlier quarter's $343 million, or $1.19 per share. That significantly exceeded the analysts' consensus estimate of $1.95 a share, according to Reuters Estimates.
Excluding one-time items and stock-based compensation expenses, the Mountain View, California,-based company reported a profit of $2.49 per share. On that basis, analysts had forecast $2.22 a share.
Revenue rose 77 percent to $2.46 billion. Wall Street was looking for revenue, on average, of $2.40 billion. Forecasts ranged between $2.30 billion and $2.52 billion, according to Reuters Estimates.
Debate is raging over whether Google -- which enjoys growth rates two-to-three times faster than other major Internet companies -- is vulnerable to slowing industry growth trends or is itself a disruptive force taking share from rivals. On Tuesday, rival Yahoo Inc. postponed an upgrade to an advertising system designed to compete with Google and its shares suffered its biggest one-day percentage decline ever.
SEATTLE (Reuters) - Microsoft Corp. (MSFT) posted a decline in quarterly net profit on Thursday, hurt by production costs for its Xbox 360 game console and a combination of slow growth and increased investment for its Internet business.
The software maker reported a net profit of $2.83 billion, or 28 cents per diluted share, for its fiscal fourth quarter ended June 30. A year ago, Microsoft delivered a net profit of $3.7 billion, or 34 cents per share, boosted by a tax gain.
Fourth-quarter revenue rose 16 percent to $11.8 billion.
Analysts, on average, had forecast Microsoft to report a net profit of 30 cents per share on revenue of $11.6 billion, according to Reuters Estimates.
Microsoft caught investors by surprise in April when it revealed plans to invest an additional $2.6 billion to fund its flagging Web operations and other new businesses. The move dampened optimism that new products and an online strategy shift would bear fruit this business year.
Since the company reported fiscal third-quarter earnings on April 27, the stock has fallen about 16 percent versus a 5 percent decline on the S&P 500 index. (^SPX - news) Prior to the earnings release, the stock closed down 55 cents at $22.85 in Thursday Nasdaq trade.
SAN FRANCISCO (Reuters) - Advanced Micro Devices Inc. (AMD) posted a higher quarterly profit Thursday as the No. 2 maker of microprocessors for personal computers took more market share from bigger rival Intel Corp.
AMD said that for its second quarter ended July 2, its net profit was $88.8 million, or 18 cents per share, compared with $11.3 million, or 3 cents per share a year earlier.
Wall Street had expected AMD to earn $89.2 million, or 17 cents per share, excluding special items, according to the average analyst forecast on Reuters Estimates.
DETROIT (Reuters) - Ford Motor Co. (F) Thursday posted an unexpected second-quarter loss as sales of sport utility vehicles, its most profitable models, slumped on higher U.S. gasoline prices and it took charges for employee buyouts.
Ford, which is closing 14 plants and cutting up to 30,000 factory jobs in North America, said it had a second-quarter net loss of $123 million, or 7 cents a share, compared with a profit of $946 million, or 47 cents a share, a year ago.
The loss from continuing operations was 3 cents a share, compared with Wall Street analysts' average expectations for a profit of 14 cents a share, as tracked by Reuters Estimates.
Revenues for Ford, the No. 2 U.S. automaker, fell to $41.97 billion in the second quarter, down from $44.55 billion a year earlier.
Ford's U.S. vehicle sales fell 7 percent in the quarter.
The results are seen underscoring the pressure on Ford's turnaround plan. The company, which lost $1.2 billion in the first quarter, cautioned last week that business conditions have become tougher over the past six months.
Ford Chairman and Chief Executive Bill Ford Jr. said on Thursday the automaker is working to accelerate its turnaround efforts.
"Within the next 60 days, we'll be in a position to discuss the additional actions we will be taking," he said in a statement.
Ford has been hit hard by high gasoline prices that have caused consumers to shift away from sport utility vehicles and large trucks to smaller and less profitable cars — an area of relative weakness for Ford.
Ford said the pre-tax loss in the quarter for its core automotive operations widened to $808 million, excluding special charges, compared with a loss of $245 million a year earlier, while its finance arm contributed net profit of $441 million. In North America, the automotive operations had a loss of $797 million, before taxes and excluding special items, compared with $907 million a year earlier.
NEW YORK(Reuters) - Pfizer Inc. (PFE) Thursday said second-quarter earnings from continuing operations rose about 13 percent on higher sales of medicines like cholesterol fighter Lipitor and Celebrex for arthritis.
The world's largest drugmaker earned $3.66 billion, or 50 cents per share, compared with $3.32 billion, or 45 cents per share, in the year-ago quarter.
The results do not include unusual items and discontinued operations, such as earnings and revenues from Pfizer's consumer health-care business, which is slated to be sold later this year to Johnson & Johnson (JNJ).
Pfizer shares are little changed since the beginning of the year, compared with a 3.7 percent gain for the American Stock Exchange Pharmaceutical Index of large U.S. and European drugmakers.
Including special items, such as merger-related expenses and restructuring costs, earnings from prescription drugs fell 30 percent to $2.4 billion, or 33 cents per share.
The company stuck to its previous full-year 2006 profit forecast of $2.00 per share.
Pfizer said sales of Lipitor rose 9 percent to $3.1 billion despite growing competition from generic versions of cholesterol drugs.
Pfizer said it continues to believe that sales of Lipitor, the world's biggest-selling medicine, will grow to $13 billion this year, despite the tough competitive landscape.
Pfizer said Celebrex, another linchpin of hoped-for future earnings growth, saw sales leap 17 percent in the quarter to $471 million. That represents a major rebound for the medicine, whose sales plunged in the past year on safety concerns.
NEW YORK (Reuters) - Wyeth (WYE) Thursday said its second-quarter earnings rose 8.5 percent and lifted its 2006 profit forecast, helped by surging demand for its Prevnar vaccine and Enbrel rheumatoid arthritis drug.
The Madison, New Jersey-based drugmaker, whose shares rose 1.5 percent in pre-market trade, said it earned $1.06 billion, or 78 cents per share, compared with $976.6 million, or 72 cents per share, in the year-ago period.
Excluding items, earnings were 80 cents per share. Analysts, on average, expected earnings of 76 cents per share, according to Reuters Estimates.
Chief Financial Officer Ken Martin told analysts on a conference call that the company is raising its 2006 forecast from its prior view of $2.97 to $3.07 per share. Analysts expect $3.10 per share.
"The range is now somewhere north of $3.07," Martin told analysts in a conference call.
Wyeth raised its profit forecast, even after saying that its tax rate this year will likely be 1 percentage point higher than the earlier projection of 22 percent.
Wyeth said global net revenue rose 9 percent to $5.2 billion. Analysts expected $4.96 billion in revenue.
Sales of Wyeth's Effexor anti-depressant franchise rose 3 percent to $918 million. Sales of Prevnar, Wyeth's vaccine to prevent pneumococcal disease, rose 60 percent to $518 million. Sales of heartburn drug Protonix fell 3 percent to $441 million.
Wyeth said its overseas sales of Enbrel rose 36 percent to $370 million. Enbrel sales in the U.S. and Canada are expected to be reported by Wyeth's marketing partner Amgen Inc. (AMGN) later on Thursday.
Wyeth shares rose 67 cents to $45.00 on the Inet electronic brokerage system.
Shares of Wyeth have fallen 3.4 percent so far this year, compared with a 3.7 percent gain for the American Stock Exchange Pharmaceutical Index of large U.S. and European drugmakers.
BOSTON (Reuters) - Honeywell International Inc. (HON) Thursday said quarterly earnings surged, topping Wall Street estimates, on strong demand for its automation and control products.
Honeywell, which makes products ranging from cockpit electronics to thermostats, reported that second-quarter profit increased to $521 million, or 63 cents per share, from $302 million, or 36 cents per share, a year ago.
Sales advanced 12.4 percent to $7.9 billion from $7.03 billion.
Wall Street analysts expected 61 cents per share, according to Reuters Estimates.
The company raised its full-year profit forecast to a range of $2.48 to $2.53 per share, up from prior guidance of $2.40 to $2.50 per share. Wall Street analysts expected a profit of $2.49 per share, according to Reuters Estimates.
"We believe that end-market conditions will remain favorable and macro trends will support our long-term business growth," Chairman and Chief Executive Officer David Cote said.
The Morris Township, New Jersey-based company said profits at its automation and control systems unit were up 18.6 percent on 16 percent sales growth.
But the pace of growth was slower at its aerospace unit, where profits rose 1 percent on 1.3 percent sales growth.
In a morning research note, Deutsche Bank analyst Nigel Coe said the overall Honeywell result was better than expected, but added that the "disappointing" aerospace results may attract more investor attention.
Honeywell, which is the world's largest maker of cockpit electronics and produces automation systems for commercial and residential buildings, has been boosted by solid demand in the aerospace sector and booming construction, particularly in rapidly developing China and India.
Its shares have risen 2.6 percent so far this year, while the blue-chip Dow Jones industrial average has climbed 2.7 percent gain after both rebounded sharply Wednesday.
Shares rose 1.1 percent, or 41 cents, to $38.65 before the bell on the Inet electronic brokerage network.