(Updated from 8:16 a.m. ET)
Advanced Micro Devices
, storage outfit
and software maker
issued warnings last night, telling investors that earnings and revenue would fall well short of analysts' estimates. The terrible troika fell heavily in after-hours trading, a sign that
today's action could be rough and tumble headed into the weekend.
AMD warned that second-quarter sales would fall some 17% from the first quarter. Analysts were prepared for a slide in sales, but their estimates of a 10% decline were too conservative. The sales slump will result in earnings of 3 cents to five cents a share, far short of the 27-cent estimate and the year-ago 61 cents.
For more on AMD's situation and how it affects the semiconductor industry, by and large, please read Caroline Humer's story "
AMD Plunges as Price War Takes Its Toll."
Earnings Reports & Warnings:
- Alcoa (AA) - Get Alcoa Corp. Report, the world's largest aluminum producer, announced second-quarter EPS of 49 cents, beating analyst expectations of 45 cents a share and two cents better than the 47 cents a share it earned a year ago.
BMC Software warned that first-quarter EPS would come in between 6 cents and 8 cents a share, lower than its previously expected guidance. Revenue will be 3% to 5% lower than BMC's previous expectations, set back in April.
EMC warned that second-quarter EPS would come in between 4 cents and 6 cents, lower than the analysts' 17-cent estimate. The company also said that revenue would come in around $2 billion, less than the $2.43 billion expected by Wall Street. EMC blamed the global slowdown in IT spending for the miss.
RadioShack (RSH) said same-store sales rose 4% in June, citing strong sales of its wireless communications equipment. Total sales in June rose to $356.6 million from $331.4 million, an increase of 8%. The company also said that it would buy back
Microsoft's (MSFT) - Get Microsoft Corporation (MSFT) Report 25% stake in the
Radioshack.com partnership for $88 million.
Veritas Software (VRTS) - Get Virtus Investment Partners, Inc. Report, a maker of software that helps companies manage their networked storage, did something that AMD, BMC and EMC didn't -- it reaffirmed its financial outlook for the second quarter. In the recently concluded quarter, Veritas said revenue growth would be between 35% and 50% year-over-year. The company added that it was comfortable with Wall Street's consensus earnings estimate of 19 cents.
Mergers & Acquisitions:
- Northrop Grumman (NOC) - Get Northrop Grumman Corporation Report extended its tender offer for the shares of
Newport News Shipbuilding (NNS) that it doesn't own. Northrop's old deadline of July 5 was extended by two weeks, until July 19. Northrop is continuing its hostile bid for Newport, which is planning to merge with
General Dynamics (GD) - Get General Dynamics Corporation (GD) Report.
On the Analyst Front:
EMC was downgraded to near-term neutral from buy at
Merrill Lynch, in reaction to last night's earnings warning. EMC spinoff
McData (MCDT) took collateral damage and was downgraded to accumulate from buy.
Aside from Alcoa's earnings release, which came out this morning, there are no other major earnings releases scheduled for today.
In Overnight Activity:
- Advanced Micro Devices fell 16.2% after telling Wall Street that second-quarter sales would dip 17% from the first quarter's disappointing levels. Analysts had been accounting for a 10% slump in sales before the warning, which pressured not only AMD's share price but that of rival
Intel (INTC) - Get Intel Corporation (INTC) Report, off 9.3% in post-close action.
EMC fell 9.3% after warning of a second-quarter shortfall. Other storage makers, like
McData (MCDT) , an EMC spin off, could feel the pressure in today's session.
BMC Software dropped 12.1% after warning that first-quarter EPS would come in between 6 cents and 8 cents, missing the 13-cent estimate.
For an extended take on late-night action, be sure to take a gander at
The Night Watch.
Sources & Definitions:
All analyst EPS estimates are from Thomson Financial/First Call, unless otherwise noted. All economic forecasts are from
, unless otherwise noted. All times are Eastern, always. After-hours quotes courtesy of Instinet, unless otherwise noted.