Tag Archives: request

Twitter Failure To Engage Mass Market Sparks Price-Target Cut

Twitter ( TWTR ) got a price-target cut Thursday from investment bank Morgan Stanley, citing falling user engagement and shrinking user growth at the social media site. Unlike its chief rival Facebook ( FB ), Twitter has yet to “break into the mass market,” wrote Morgan Stanley analyst Brian Nowak in an industry note Thursday. Remaining a niche service “makes us wary of Twitter’s addressable audience, and the question marks around the company’s ability to drive future user growth appear unlikely to go away in the near term,” he said. Nowak lowered his price target on Twitter stock to 16 from 18. Twitter stock was down a fraction in afternoon trading in the stock market today , near 17, but that was up 24% from its all-time low of 13.91 brushed on Feb 12. Morgan Stanley also trimmed its projections for Twitter’s user growth. Twitter will end this year with 307.1 million global users, the investment bank now says, down from its original projection of 310.6 million. The amount of time each user spends on the site is also declining, Nowak said, with those lower engagement levels “holding back revenue growth.” In Q4, Twitter’s U.S. mobile users averaged just 2.7 minutes daily on the site, said Nowak, compared to 40.5 mobile minutes for music streaming service Pandora Media ( P ), 30.3 minutes for Facebook and 8 minutes for YouTube, owned by Alphabet ( GOOGL ) subsidiary Google. That’s based on research from ComScore and Morgan Stanley. This year’s new users are expected to come mainly in the second half of the year, with major news events including the U.S. presidential election, the Rio Summer Olympics and the company’s recently announced deal  with the NFL. Twitter reportedly beat out Facebook, Alphabet,  Amazon.com ( AMZN ),  Verizon Communications ( VZ ) and Yahoo ( YHOO ) to capture digital rights to the NFL’s Thursday Night Football. It’s a high-profile foray into live programming for Twitter and for the NFL, which in the past has only streamed selected games. “An inability for these events to deliver would likely mean even more downside to our monthly active user estimates,” Nowak wrote.

Oracle Cloud Should ‘More Than Offset’ Slip In New Licenses In ’17

With a chance to chat with Oracle ( ORCL ) customers during its Chicago trade show that ends Thursday, Evercore ISI analyst Kirk Materne came away more convinced that the legacy software leader has its head in the fast-growing cloud. And atop Oracle’s head is a “halo for more cloud uptake,” UBS analyst Brent Thill said in a separate research note. Not that Oracle investors necessarily agree. Oracle stock was down 1.5% in early afternoon trading in the stock market today , near 40. Rival Workday ( WDAY ) was down about 1%, but upstart enterprise software competitor ServiceNow ( NOW ) was up a fraction. Beginning with Oracle’s fiscal 2017, which starts June 1, its cloud “contribution to overall revenue growth will more than offset the declines in the new software license business (or in a more bearish scenario, essentially cancel out the license declines), which we expect to be a 2% headwind to total revenue growth,” Materne wrote in a research note Thursday. By cloud, he means software as a service (SaaS) and platform as a service (PaaS), the popular pay-a-little-as-you-go model that is supplanting large, long-term license fees for software running on-premise enterprises and databases. “And as the base of new license revenue gets smaller, in FY ’18 we project that new software license declines will negatively impact revenue growth by just 90 (basis points),” Materne said. His parsing of the numbers, customer satisfaction and co-CEO Mark Hurd’s commentary came out of the HCM World conference, where some of Oracle’s 6,000 Fusion HCM (human capital management) clients began gathering Tuesday at the Hyatt Regency Chicago to compare notes. Not that they’re all up and running with the new software. It’s a process. Materne said only about 1,000 “core” human resources customers have gone “live” with Fusion HCM. Others are gearing up. Workday Sees Oracle Lagging The lag time between landing a customer and fully implementing the software was on Workday CEO Aneel Bhusri’s mind during his last quarterly conference call when he said bluntly that Oracle has “had time to get customers into production and hasn’t been able to, (while) 75% of our customers are in production. That’s actually the real driver behind win rates.” UBS analyst Thill, in his research note Thursday, counted 600 live customers of Oracle’s latest Fusion HCM release, including Schneider Electric, BT Group ( BT ) and Siemens ( SIEGY ). He said the “pace of go-lives (is) improving as sales/post-sales motions have matured. “Cloud uptake (is) begetting more cloud (with) better attach rates of other cloud solutions,” Thill said, adding that about 50% of Oracle’s midsize HCM customers are also buying Oracle’s financial management SaaS. Besides, Oracle’s “international prowess (is) underappreciated, with some of the biggest opportunities outside the U.S.,” he said. Oracle supports seven “global payrolls” with software in 24 languages in 199 countries, Thill said. While cloud growth might “offset” legacy sale slippage, cloud products won’t outsell on-premise revenue anytime soon. In Oracle’s Q3 ended Feb. 29, total revenue fell 3% to $9 billion, due largely to currency headwinds. SaaS and PaaS sales rose 57% from a year earlier to $583 million, as legacy on-premise software slipped 1% to $7.1 billion, although the latter was up 3% in constant currency. For the current Q4 ending May 31, analysts polled by Thomson Reuters expect Oracle to report earnings per share minus items of 82 cents, up 5%, on revenue of $10.46 billion, down 2.3%.

First-Week Tesla Model 3 Reservations In, Worth $14 Billion In Sales

Tesla Motors ( TSLA ) tallies more than 325,000 Model 3 reservations in the first week that preorders for the electric car have been open worldwide. The company tweeted the update Thursday morning and said in a blog post that it would be “increasing Model 3 production plans.” Tesla stock was down more than 2%, near 260, in early-afternoon trading on the stock market today . The early reservations pace has run far higher than analysts and Tesla expected. Tesla stock now gets a 72 Composite Rating from IBD out of a possible 99, and this week has been trading at its highest price since September. Shares rose 3.9% on Wednesday, to 265.42, marking a fourth day straight of better-than-3% gains. Analysts surveyed by Thomson Reuters on average are mildly positive on Tesla stock. Of 21 polled, nine call it a buy or strong buy, five a hold and seven an underperform. At $1,000 each, the first week’s Model 3 reservations bring in $325 million for the California startup, which will have to ramp up production dramatically to get all those cars delivered. The reservations reflect eventual potential sales of $14 billion worth of Model 3 cars if all who’ve reserved follow through with a purchase. A huge step towards a more sustainable future: 325,000 and counting https://t.co/XKlywcYhp8 #Model3 pic.twitter.com/a367jCJgaK — Tesla Motors (@TeslaMotors) April 7, 2016 “A week ago, we started taking reservations for Model 3, and the excitement has been incredible. We’ve now received more than 325,000 reservations, which corresponds to about $14 billion in implied future sales, making this the single biggest one-week launch of any product ever,” Tesla said in its blog post, titled “The Week That Electric Vehicles Went Mainstream.” CEO Elon Musk has estimated buyer spending would likely be an average price of $42,000. (Analysts expect that because the deposits are refundable and just $1,000, not everyone who’s reserved will pony up and actually purchase, though others will be joining the line.) Will give an update tonight for the 3 day total, then last one on Wed for the full week. All efforts focused on accelerating the ramp. — Elon Musk (@elonmusk) April 2, 2016 The Model 3 is slated to start deliveries in late 2017. Musk has been tracking the Model 3 reservations inflow on Twitter ( TWTR ), from 180,000  in the first 24 hours to 276,000 by the end of Saturday. Tesla debuted the $35,000-base-price car last Thursday night at a launch party at the Tesla design studio in Los Angeles, where IBD tried a ride in the Model 3 . It’s a mass-market vehicle expected to compete with gas-powered cars like BMW’s 3 Series and similarly priced ones from Volkswagen ’s ( VLKAY ) Audi, Daimler ’s ( DDAIF ) Mercedes-Benz and Toyota ’s ( TM ) Lexus, as well as electrics like General Motors ‘ ( GM ) Chevrolet Bolt. While Tesla expects to be able to build up to half a million cars annually by 2020, it hit a speed bump in the first quarter and delivered fewer vehicles than expected — 12,420 — after supplier parts shortages for its latest Model X crossover. Tesla partly blamed its own “hubris” in adding too much technology to the vehicle too early. This Is What It’s Like To Ride In A Tesla Model 3