Maven: Earnings Contempt

Coverage of quarterly results delivered Tuesday wrongly focused on the trading, not the numbers.
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From the depths of his persnickety little soul, all The Business Press Maven really wants is sober contemplation of numbers.

But the business media too often take dictation from after-hours or premarket trading, writing about numbers with one eye on the figures and the other on the blips and spurts of thin action.

Just look at the mess we're faced with this morning when it comes to





(INTC) - Get Report

and you'll agree that The Business Press Maven has a better chance of striking it rich in a Klondike gold rush than reading emotionless and informed summaries of earnings reports.


this item



Stock futures were up at 5:45 a.m. EDT, which is mentioned in the second sentence of the story as if it validated any positive threads of thought throughout, such as this simplified misleading gem of a headline that hit up at 6:02 a.m.:

Stocks could rally on tech news: Better than expected results from IBM, Intel, good news from Yahoo, helps lift stock futures but pending inflation and housing readings could spoil the party.

Nevermind the way both feet are planted so firmly in the air: The market could rise unless it falls. I want to focus on the way after-market action clouded judgment of these bellwether earnings.

No argument here on


(IBM) - Get Report

. Kudos to the boys and girls from Armonk, N.Y.

But though shares of Intel and Yahoo! rose in extended trading Tuesday, garnering them slightly better coverage than they should have gotten, the earnings reports were complex -- maybe problematic -- and should in no circumstances be mentioned in the same breath as IBM's, no matter what futures pricing looks like when the sane among us are asleep.

Take Intel, but first put on a neck brace to avoid whiplash.

Top and bottom lines fell, but beat expectations.

There was strengthening demand for microprocessors, but the company admitted it was owed to a grim comparison. It wrote off $100 million in microprocessors, but inventories rose.

Intel said it had taken market share from archrival

Advanced Micro Devices

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, but wouldn't deign to say how much.

Intel has slashed prices over the past three months, but said prices are stabilizing.

Yahoo!, with disappointing results but some promises, was also straddling that line between the states of good news and bad news.

But to show you how bass-ackward the business media can get it, a rough and unscientific count by The Business Press Maven across business publications this morning shows the after-market reaction to Yahoo!'s earnings mentioned more frequently and prominently than the more important factor: As disappointing as Yahoo's results were, they were really even more so than we thought.

The company ratcheted down numbers very recently, on Sept. 19, yet it spoke Tuesday about "unanticipated challenges."

That's a short window of time in which to lose sight of challenges. Yikes.

It also calls into question how good Yahoo! will be on fulfilling the many promises made Tuesday, from rolling out the long-awaited new Web search system to a vague promise to get back to basics, which might be wishful thinking in an environment that has more competition.


Los Angeles Times


the after-hours share rise in its third sentence on the report.

It didn't even mention that earnings had recently been guided downward. (Yahoo!, it should be noted, also dropped fourth-quarter projections.)

The Wall Street Journal

got it almost all right in a first-page


this morning: "Yahoo! Faces Pressure From Rivals In Its Search for Online Ad Dollars."

That, after all, is the key issue in what is becoming serial underperformance.

Social networking and online video sites owned by Yahoo!'s competition are the hot rides of late, attracting advertising dollars formerly earmarked for Yahoo!, and the


is right to mention the after-market movement of Yahoo!'s stock only as an afterthought, at the bottom of the article.

In the article's third paragraph, however, the author weighs in with some advice that has, perversely, been the downfall of many companies in fast-changing businesses where the competition has had short-term success with acquisitions:

The development of competition for online ad dollars is a further sign of fast changes to the Web landscape and the perils facing any large Internet companies that don't successfully ride successive new waves of consumer trends.

With apologies to the bullishness of a few after-market traders, if you think Yahoo! shareholders have worries now, wait until the company tries to front-run every last whim of a trend coming online.

The key for investors is to look beyond the after-hours traders and beyond this week's hot site to see what form the Web will take.



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future taken a different form?

The Wall Street Journal

plays it straight this morning, simply


that Wal-Mart, with all its current struggles and traditions of holding costs in line, is headed to Manhattan (and surrounding areas) for the first time for its annual presentation to analysts and investors, which will be a star-studded affair including performances by the Eagles and Garth Brooks.

No word on where Sam Walton, famous for doubling up with other executives in dive motel rooms to hold costs, will bunk in Manhattan, clutching that Eagles backstage pass as he counts money flying out the window.

A journalist with a background on Wall Street, Marek Fuchs has written the County Lines column for The New York Times for the past five years. He also contributes regular breaking news and feature stories to many of the paper's other sections, including Metro, National and Sports. Fuchs was the editor-in-chief of, a financial Web site twice named "Best of the Web" by Forbes Magazine. He was also a stockbroker with Shearson Lehman Brothers in Manhattan and a money manager. He is currently writing a chapter for a book coming out in early 2007 on a really embarrassing subject. He lives in a loud house with three children.