Technology Stock Roundup: Intel at Computex, Apple at WWDC

Zacks

With two big events in five days and another one coming up tomorrow, there was plenty of excitement last week. Here’s a recap of the top stories: 

Intel Enables The Thinnest, Lightest Tablets

At Computex, one of the largest computer expos in the world, Intel (INTC) showed off the world’s first 14nm reference design. The much-awaited Broadwell chip (Core M) appears to have delivered as promised, with the fanless design enabling significantly thinner and lighter convertibles. The reference design is just 7.2 mm thick and much lighter than existing devices. Broadwell is expected to ship in time for the holiday season.

Intel announced 130 Android and Windows tablet designs that would ship this year and said that 35% of Atom-based tablet designs included Intel communications. Other announcements included the first SoC called SoFIA for smartphones and the 4th generation Core i7 processor for enthusiasts.

Flicker Gets Rid of Google/Facebook Logins

Yahoo (YHOO) will be removing Google (GOOG) and Facebook (FB) logins from its popular Flickr photo sharing app. The company had previously announced that only Yahoo logins would be active on both Fantasy Sports and Flickr. While the changes have already been made to Fantasy Sports, they will become effective on Flickr by Jun 30. The change will not affect paid services like Flickr Pro.

Companies generally go for Google and Facebook logins (as Yahoo did in 2011) when they want to increase the user base. But using a Yahoo account for all Yahoo services will enable better personalization, which will help retain users. The change indicates that Yahoo’s user base has attained critical mass, so focus is shifting to retention. No wonder share prices went up.   

Apple Focuses on  WWDC

Apple’s (AAPL) Worldwide Developers Conference (:WWDC) updates included iOS 8, OS X 10.10 Yosemite, Healthkit and a new programming language called Swift.

The new OS includes a redesigned user interface much like the previous version, but with additional features enabling seamless integration between Mac and iOS devices and a new cloud storage system called iCloud Drive. The seamless integration between the phone and computer could be a competitive differentiator as it is something both Google and Microsoftcould find hard to replicate (Android has limited presence in computing and Windows has limited presence in smartphones). The convenience on the other hand is something customers could get used to, thus helping retention.

The Swift programming language is simpler, faster and more interactive, which should encourage younger and less-experienced programmers to develop apps.

Apple also announced better maps, weather data and improved Chinese-language input, as well as support for the lunar calendar, all targeting China.

Company

Last Week

Last  6 Months

AAPL

+1.98%

+13.97%

FB

-1.23%

+27.97%

YHOO

+3.71%

-7.59%

GOOG

-0.07%

 

GOOGL

+0.01%

+4.90%

MSFT

+1.17%

+7.16%

INTC

+3.13%

+13.00%

CSCO

+0.65%

+17.01%

GOOG = Class C shares (new, non-voting)

GOOGL = Class A shares (old, 1 vote per share)

Other stories you may have missed-

China Punishes Microsoft:  Following measures taken against Cisco (CSCO) and IBM (IBM), the Chinese government has now turned to Microsoft (MSFT). The government has reportedly asked officials in the Jiangsu province of Shanghai not to use Windows 8.

This is not the first time that China has expressed dissatisfaction with Windows 8. Beijing's municipal government has pointed to its high costs, leading several local governments to go for cheaper home-grown systems. Microsoft has said that the NSA is costing technology companies and asked the government to stop hacking data centers or cables.

Google in the Satellite Business: Not unexpectedly, Google will be spending $1-3 billion to build a fleet of 180 satellites providing Internet access around the world. The small, high-capacity satellites will orbit at lower altitudes than traditional satellites and could make some Google services, such as maps and voice search better.

Google bought drone-maker Titan Aerospace for $60 million a couple of months back. And some time before that, it leased Hangar One of Moffet Federal Airfield from the NASA for “research, testing, assembly and development of new technologies related to space and aviation.”

Google’s Mobile Share Shrinking: An eMarketer report says that Google’s share of mobile search advertising dollars has gone from 82.8% in 2012 to 68.5% in 2013 and is likely to move to 64.2% by 2016. Google’s app indexing and deep-linking efforts will likely not be enough to stave off competition from Yahoo, Microsoft, Amazon (AMZN), Kayak and Shazam, which will together grab 29.7% market share by 2016, according to the research firm. Google’s revenue from mobile search will however continue to grow because of overall market growth.

IDC Releases Some PC and Server Numbers: IDC’s estimates for the PC market remains more or less unchanged, with the firm now expecting PC shipmentsto decline 6.0% in 2014 (previous 6.1%).  The March quarter was the fifth straight quarter of decline in server revenue although shipments increased slightly.

The reason was the strength in low-end systems as well as issues in the mid and high-end segments including product transition, technology refresh cycles and difficult comps. Hewlett-Packard remains the leader, followed by IBM, Dell and Cisco. Cisco did the best, based on strength in the x86 industry standard blade servers.

AMD Extends Debt Maturity

E3 Coming Up (Jun 10-12)

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