Pokemon Go takes the mobile gaming world by storm, highlights augmented reality's potential

As you might be aware, a certain iOS/Android game involving Japanese anime characters has gained a strong following over the last few days. Though it only launched last Wednesday, Pokemon Go has already seen 7.5 million U.S. downloads and is producing $1.6 million in daily revenue via in-app purchases, according to app analytics firm SensorTower. SimilarWeb, another analytics firm, thinks Pokemon Go's U.S. Android daily active user base had nearly matched Tinder's as of last Friday.

For those wondering, Pokemon Go lets users create digital avatars that roam around and catch/collect Pokemon characters. What's unique is that the avatars roam around in the real world, with the game using GPS, mapping technology, and a phone's camera to real-world locations where Pokemon characters can be "found," with their drawings superimposed on a phone's camera view upon discovery. As such, Pokemon Go is a textbook example of an augmented reality app ... a spectacularly successful augmented reality app that has been producing huge crowds at some of the locations where characters are "placed."

Not surprisingly, Nintendo, which owns the Pokemon franchise, has seen its shares soar thanks to Pokemon Go's reception. Alphabet  (GOOGL - Get Report) also financially benefits from the game: It maintains a stake in Pokemon Go developer Niantic, which was originally a Google spinoff, and provides the cloud infrastructure services underpinning the game. But for a company of Alphabet's size, Pokemon Go can't be expected to have a major top-line impact. Especially as some of the initial fervor dies down.

But there are other reasons for Google, as well as some other tech giants, to take heart in Pokemon Go's performance. For starters, it shows that well-made augmented reality apps can have mass-market consumer appeal. Google, which is still working on its Glass augmented reality headset in spite of its early setbacks and PR issues, has to be pleased with that. As does Microsoft (MSFT - Get Report) , which recently began shipping development kits for its HoloLens augmented reality headset. Himax Technologies (HIMX - Get Report) , which supplies microdisplays for Google Glass and reportedly HoloLens, rose 6% on Monday.

Second, augmented reality apps with access to a user's location data open up a number of possibilities for local ads and commerce services. That could not only help developers, but also owners of major mobile ad networks, such as Google and Facebook (FB - Get Report) .

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PC sales were better than expected in the second quarter, but still soft

After reporting PC shipments fell 11.5% annually in the first quarter, IDC estimates they fell a relatively modest 4.5% in the second to 62.4 million units, easily topping the firm's expectations for a 7.4% drop. Gartner estimates shipments fell 5.2% to 64.3 million units, after having estimated a 9.6% first-quarter drop.

IDC notes much of the improvement stems from improving channel inventories, better component supplies and easier comparisons -- PC shipments were also down sharply a year ago -- rather than end-user demand. But it is optimistic the end of free Windows 10 upgrades on July 29 will provide a boost. IDC also observes demand for Chromebooks - notebooks running on Google's Chrome OS -- was strong, and helped U.S. shipments rise 4.9% in spite of international declines. A mix shift towards the U.S. might benefit Intel (INTC - Get Report)  and HP (HP - Get Report) , given the U.S. market has relatively high PC and CPU average selling prices (ASPs).

Lenovo was once more the world's biggest PC vendor, with IDC estimating a 21.2% global shipment share. HP was No. 2 at 20.8%, Dell No. 3 at 16%, Asus No. 4 at 7.2%, and Apple  (APPL)  No. 5 at 7.1%. Apple's revenue share might be above 15%, given Macs carry high ASPs.

With the help of superior scale and R&D investments, top-5 PC manufacturers continued taking share from smaller rivals. IDC estimates non-top 5 PC makers collectively saw their share drop to 27.7% from 31.8% a year ago.

Seagate soars after forecasting better-than-expected results and announcing major job cuts

Less than a week after Western Digital  (WDC - Get Report)  upped its calendar second-quarter guidance, archrival Seagate (STX - Get Report) has done the same. The company, less than two weeks removed from disclosing it's laying off 1,600 workers, also announced it's now cutting 6,500 jobs, or 14% of its workforce. Western's shares are following Seagate's higher.

Given IDC and Gartner's PC numbers, better-than-expected PC hard drive sales likely gave Seagate and Western a lift. But Seagate notes it saw better-than-expected enterprise demand thanks to "the evolution of mobile and cloud data driven environments." Improving capital spending from cloud giants (Google, Facebook, Amazon (AMZN - Get Report) , etc.) with massive storage needs appears to be helping out. Other names with strong exposure to cloud capex include data center switch provider Arista Networks  (ANET - Get Report) and optical component makers Oclaro (OCLR)  and NeoPhotonics (NPTN - Get Report) .