Tag Archives: Investment & Company Information

Sony predicts it’ll sell fewer PS5s than first thought

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Sony has lowered its PlayStation 5 sales forecast for fiscal 2023 significantly and now expects to sell 21 million units, down from a previous forecast of 25 million. That's despite posting record quarterly revenue and selling 8.2 million PS5s over the holiday season. So far this fiscal year, Sony has sold 16.4 million consoles, bringing its total to 54.8 million overall. (The company sold 19.1 million PS5s in fiscal 2022.)

Sony announced in December that it had sold 50 million PS5 units over three years, as of December 9, 2023. That's just a week longer than it took the PS4 to achieve the same number, and the latter wasn't bogged down by supply chain issues and a worldwide pandemic. 

Revenue was up 16 percent over the same quarter last year, thanks in part to improved sales of non-first-party titles. However, operating income was down significantly (26 percent), due a drop in first-party sales and losses on hardware due to promotions. In other words, PS5 sales aren't meeting the company's expectations despite discounts. 

Sony has seen higher sales in all three quarters this year compared to last. That might not continue this year though, as it's forecasting sales of just 4.6 million for Q4 2023 (February to April), down from 6.3 million in Q4 2022. 

In terms of new first-part games, Sony noted that Marvel's Spider-Man 2 has sold 10 million units (as of February 4) since its release in October 2023.

Almost all other Sony divisions saw higher revenue, including its Imaging & Sensor Solutions division (Sony makes sensors for iPhones and many other devices), along with Pictures and Music. That resulted in a record 3.75 trillion yen for Q3 ($24.9 billion) compared to 3.08 trillion yen the year before ($20.5 billion). 

This article originally appeared on Engadget at https://www.engadget.com/sony-predicts-itll-sell-fewer-ps5s-than-first-thought-091816189.html?src=rss

Toyota unveils a three-row electric SUV for the US market

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While Toyota helped lead the hybrid charge with its Prius, the company has been less active in EV production. But that might be in the past, as Toyota has announced another $1.3 billion for its Kentucky facility, with a focus on EVs. In particular, the company is building a new three-row electric SUV that will be available for US customers. 

Toyota's Kentucky operation is its flagship facility, with nearly 9,400 employees. "Today's announcement reflects our commitment to vehicle electrification and further reinvesting in our US operations," Kerry Creech, president of Toyota Kentucky, said in a release. "Generations of our team members helped prepare for this opportunity, and we will continue leading the charge into the future by remaining true to who we are as a company and putting our people first for generations to come."

Little is known so far about the three-row electric SUV, as Toyota only mentions it briefly in relation to the investment. However, it follows the company's prior announcement of its Urban SUV concept slated to launch in Europe this year. 

The $1.3 billion investment will also go towards creating a battery pack assembly line at its Kentucky factory (a separate manufacturing plant in North Carolina produces the batteries). Toyota has big plans for its battery production, previously announcing three battery ranges focused on higher performance and low cost slated for 2026 and onward. The company is also working on its first solid-state batteries, which have the potential to charge an EV from 10 to 80 percent in 10 minutes. Toyota's bZ4X EV currently takes 32 minutes to do so. 

This article originally appeared on Engadget at https://www.engadget.com/toyota-announces-a-three-row-electric-suv-for-us-customers-092545458.html?src=rss

Nintendo believes it’ll sell more Switch consoles than first thought

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At almost seven years old, the Nintendo Switch still has life left in it — so much so that Nintendo has upped its predicted sales figures for its current fiscal year. In its third-quarter earnings release, the company announced that it was increasing Switch's projected sales from 15 million to 15.5 million. The boost follows overall third-quarter net sales that were 29.9 billion Japanese yen ($201.1 million) higher and net profits of 6.4 billion Japanese yen ($43.1 million) higher than Nintendo's projections. However, it's worth noting that despite better than expected third-quarter net sales, the figure was still six percent lower than in the same period in 2022.

A few long-standing favorites and new games are likely fueling additional Switch sales. Nintendo's Super Mario Bros. Wonder game came out in October and hit 11.96 million units sold. Then there was The Super Mario Bros. Movie, which had an April release in theaters and piqued interest in older titles like Mario Kart 8 Deluxe and 2023 launches like The Legend of Zelda: Tears of the Kingdom, the company reported.

The Switch's improved sales forecast comes as gamers eagerly await the Switch's successor. While Nintendo hasn't released any substantial information yet, the gaming system will reportedly launch sometime this year (and will face a much more crowded market than its predecessor when it does). Developers allegedly got a peek at the Switch 2 (for lack of a concrete name) behind closed doors at Gamescom in August 2023. They were said to view a version of The Legend of Zelda: Breath of the Wild with a higher frame rate and resolution than the original Switch offers. The demo also reportedly showcased the Unreal Engine 5 for the upcoming Switch, ray-tracing, NVIDIA's DLSS upscaling tech, and visual quality similar to that of the PS5 and Series X.

This article originally appeared on Engadget at https://www.engadget.com/nintendo-believes-itll-sell-more-switch-consoles-than-first-thought-095017928.html?src=rss

Snap is laying off 10 percent of its workforce

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Snap, the parent company of Snapchat, is laying off 10 percent of its workforce, according to an SEC filing and confirmed by a company spokesperson. The company reported a total number of 5,367 employees at the end of 2023’s third quarter, so the layoffs should impact around 540 people.

Snap discussed the decision in the SEC filing, saying the layoffs would “best position our business to execute our highest priorities” and ensure it has “the capacity to invest incrementally” over time. The company told us the layoffs were necessary to “reduce hierarchy and promote in-person collaboration.” None of those sentences really mean anything, so let's just go with "corporate restructuring." 

Snap said in the filing that it would be issuing severance packages to the impacted employees, but there's no specific information regarding package details. A Snap spokesperson confirmed to Engadget that it's “focused on supporting our departing team members.”

These layoffs are happening just one day before Snap is scheduled to report fourth-quarter earnings for 2023. The company actually did pretty well in Q3, beating out Wall Street expectations by about five percent, according to Variety.

If tomorrow's earnings report is bad, it'll show why these layoffs are necessary. On the other hand, if it's better than expected, Snap may be announcing these layoffs now to avoid doing so after a quarter of financial gains. Nobody likes to see a big company massively reduce its headcount after bragging about earnings. Snap told us the company’s in a “quiet period” until tomorrow’s Q4 financial report drops.

This follows another round of layoffs in November, in which Snap let go of 20 product managers. However, both of these news items pale in comparison to Snap’s massive culling in 2022, which eliminated over 1,300 employees.

This article originally appeared on Engadget at https://www.engadget.com/snap-is-laying-off-10-percent-of-its-workforce-161146546.html?src=rss

Meta’s Reality labs had its best quarter, but still lost more than $4 billion

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Reality Labs, Meta’s division for AR, VR and the metaverse, just had its best quarter yet despite continuing its multibillion-dollar losing streak. Reality Labs generated more than $1 billion in revenue during the final quarter of 2023 thanks to its Quest headsets and the Ray-Ban Meta smart glasses.

While crossing $1 billion in revenue is a new milestone for the company’s metaverse group, it’s still expected to continue racking up massive losses for the foreseeable future. Reality Labs lost $4.6 billion in the quarter, and more than $16 billion in 2023. Meta CFO Susan Li said that these losses are expected to “increase meaningfully year-over-year due to our ongoing product development efforts in augmented reality/virtual reality and our investments to further scale our ecosystem.”

The fourth-quarter, which encompasses the holiday shopping season, has typically been when reality does the best. During a call with analysts, Mark Zuckerberg suggested that the company’s smart glasses had done particularly well, saying that Ray-Ban maker EssilorLuxottica was “planning on making more [smart glasses] than we'd both expected due to high demand.” He added that both Quest 2 and Quest 3 were “performing well,” calling Quest 3 the “most popular mixed reality device.”

Reality Labs aside, Meta had a strong quarter, reporting $40.1 billion to close out 2023, bringing its total revenue for the year to just under $135 billion. Facebook’s user base also grew to 2.1 billion daily active users (DAUs). Meta CFO Susan Li said that the company was “transitioning away” from sharing the metric and would no longer report on Facebook’s daily or monthly active users or its “family monthly active people.”

The company had shared that it would eventually stop reporting user numbers back in 2019 as Facebook’s growth began to slow. But the change shows how Facebook’s position in the company’s “family of apps” has changed in recent years. A report from Pew Research earlier this week found that Instagram is continuing to grow in the US while Facebook use remains flat.

Meta’s newest app, Threads, is still growing, however. Zuckerberg said the service has 130 million monthly users, up from “just under” 100 million last fall. “Threads now has more people actively using it today than it did during its initial launch peak," Zuckerberg said, referring to the app’s initial, but short-lived, surge in growth.

Zuckerberg also talked more about his newly-stated ambition to create artificial general intelligence, or AGI at Meta, saying it would be the “theme” of the company’s product work going forward. “This next generation of services requires building full general intelligence,” he said. “It's clear that we're going to need our models to be able to reason, plan, code, remember and many other cognitive abilities in order to provide the best versions of the services that we envision.”

The Meta CEO also indicated the company would be unlikely to offer any of its apps in alternative app stores in Europe, following Apple's controversial new developer policies. "The way that they've implemented it, I would be very surprised if any developer chose to go into the alternative app stores," he said. "They've made it so onerous, and I think so at odds with the intent of what the EU regulation was, that I think it's just going to be very difficult for anyone, including ourselves, to really seriously entertain."

This article originally appeared on Engadget at https://www.engadget.com/metas-reality-labs-had-its-best-quarter-but-still-lost-4-billion-231135719.html?src=rss

Apple sold enough iPhones and services last quarter to reverse a downward revenue trend

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After four consecutive quarters of revenue decline, Apple broke the trend and reported its first period of revenue growth today. In its earnings report for the first quarter of the financial year of 2024, the company announced a quarterly revenue of $119.6 billion, which is an increase of 2 percent from the same period last year. 

In addition, Apple CEO Tim Cook said its "installed base of active devices has now surpassed 2.2 billion, reaching an all-time high across all products and geographic segments." This quarter includes money brought in from the sales of the iPhone 15 line introduced in September 2023, which had an obvious impact on performance. 

"Today Apple is reporting revenue growth for the December quarter fueled by iPhone sales, and an all-time revenue record in Services,” Cook said. He noted the company hitting "all-time revenue records across advertising, Cloud services, payment services and video as well as December quarter records in App Store and Apple Care." Cook recapped some updates made to the Apple TV app, as well as TV+ content earning nominations and awards. 

Cook went on to remind us during the company's earnings call that tomorrow is the launch day for the Vision Pro headset, calling it historic. After saying that Apple is dedicated to investing in new technologies, Cook added that the company will be sharing more about its developments in AI later this year. 

Products in the wearables, home and accessories categories didn't fare well in this quarter, though sales in the Mac department did increase year over year. iPad sales in particular dropped 25 percent over the same period last year, though Cook attributed that to a "difficult compare" to the big numbers recorded in the first quarter of 2023 due to new models with refreshed Apple Silicon. Considering the company did not release a new iPad model in 2023 at all, this is not surprising. 

Cook continued by highlighting developments like Apple opening its 100th retail location in Asia Pacific and updates on its sustainability efforts. He wrapped up by saying "Apple is a company that has never shied away from big challenges," adding "so we're optimistic about the future, confident in the long term and as excited as we've ever been to deliver for our users."

This article originally appeared on Engadget at https://www.engadget.com/apple-sold-enough-iphones-and-services-last-quarter-to-reverse-a-downward-revenue-trend-223109289.html?src=rss

Samsung is betting on AI and the Galaxy S24 to turn around declining profits

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Samsung has failed to recover from the sharp decline in profit it experienced in 2022. In its latest earnings report, the Korean company has reported KRW 258.94 trillion ($194 billion) in annual revenue and KRW 6.57 trillion ($4.9 billion) in operating profit for the fiscal year of 2023. Those are markedly smaller numbers than the previous fiscal year's, especially the latter's — Samsung posted an operating profit of KRW 43.38 trillion ($35 billion) for 2022, which was already $6.9 billion smaller than the year before due to the weak demand for its chips and smartphones. According to The Wall Street Journal, these numbers represent Samsung's weakest earnings in over a decade. 

The company says its memory business showed signs of recovery, but not enough to stop it from incurring KRW 2.18 trillion ($1.63 billion) in operating losses for the fourth quarter of 2023. According to Nikkei, this is the semiconductor division's first annual loss in 15 years since the 2008 global financial crisis, and it's the biggest one yet. Samsung's visual display and digital appliances division also posted KRW 0.05 trillion ($37.5 million) in operating losses despite TV sales doing well in the fourth quarter due to the holiday season. Samsung's mobile business showed a a decline in sales and profit quarter-on-quarter, as well, due to lower smartphone sales and "the fading of new-product effects" from previous flagship models. 

For the first quarter of 2024, Samsung's game plan is to improve its profits "by increasing sales of high value-added products," such as components meant for generative AI products. It expects stronger demand for its chips in the PC and mobile sectors this year, but it admits that its earnings may not significantly recover soon because its customers are still downsizing their inventories. Samsung has high hopes for the Galaxy S24 series, though, and believes the devices' AI capabilities can help its mobile business achieve a a double-digit growth in 2024. The Galaxy S24 phones have already started shipping with prices starting at $800 for the most basic version and at $1,300 for the S24 Ultra. 

Update, January 31, 2024, 6:44AM ET: Added information about the semiconductor division's historic losses.

This article originally appeared on Engadget at https://www.engadget.com/samsungs-annual-profits-continued-to-decline-in-2023-090500640.html?src=rss

Microsoft’s gaming revenue was up 49 percent in Q2, mostly thanks to the Activision deal

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Microsoft posted another blowout earnings report for Q2 of the 2024 fiscal year, with revenues of $62 billion (up 18 percent from last year) and profits of $21.9 billion (a 33 percent increase). But really, the most interesting thing about this quarter is that we finally get to see how the $68.7 billion Activision Blizzard acquisition affects the $3 trillion company. While Microsoft isn't breaking out specific numbers, it says that its overall gaming revenue increased by 49 percent, 44 points of which came from the "net impact" of the Activision deal.

The rosy news is a bit surprising, considering that Microsoft announced last week that it was laying off 1,900 people across Xbox and Activision Blizzard. Those layoffs include the rest of Blizzard's esports division, according to reports, following 50 layoffs and a restructuring last summer.  

Microsoft's More Personal Computing division, which includes Xbox, Surface and Windows, was up 19 percent ($16.9 billion) since last year. The company says the Activision deal accounted for 15 points of that increase. It's a huge change for a division that's been severely impacted by dwindling PC sales (which affects Windows licenses and Surfaces) and struggling Xbox consoles. PC device revenues were down 9 percent for the quarter, while Xbox hardware sales were up 3 percent.

Xbox content and services revenue is also up 61 percent since last year, 55 points of which comes from Activision. It'll be interesting to see if Microsoft can actually leverage that acquisition to help Xbox sales, or at the very least, spur on more interest in Game Pass subscriptions. (Unfortunately, we don't have any updates on how that service is doing.)

This article originally appeared on Engadget at https://www.engadget.com/microsofts-gaming-revenue-is-up-49-percent-in-q2-mostly-thanks-to-the-activision-deal-222502444.html?src=rss

PayPal is laying off 2,500 employees

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PayPal is laying off nine percent of its workforce, the company’s CEO Alex Chriss told staff in a letter on Tuesday that PayPal made public hours later. The decision will impact about 2,500 employees, who will find out their fate between today and the end of the week, Bloomberg reported earlier. PayPal's layoffs come almost exactly a year after the company fired more than 2,000 workers to keep costs down. 

Despite thousands of job cuts in 2023, layoffs at tech companies have continued into 2024. On the same day as PayPal's latest layoffs, Jack Dorsey's Block, the company that owns Cash App, Foundational, and Square, conducted its second round of layoffs in two months, cutting nearly a thousand people. Earlier this month, Google laid off more than a thousand workers in its Assisstant and hardware divisions, with CEO Sundar Pichai warning employees to brace for more cuts through the year. Discord, eBay, Riot Games, TikTok, Microsoft, iRobot, Amazon, Unity, and Duolingo, among others, have collectively cut thousands of jobs in January

PayPal was one of the earliest companies in online payments industry, but in recent years, rivals like Zelle and tech companies with deep pockets like Apple, have entered the space. The competition in the payments industry is putting pressure on PayPal. Bloomberg noted that four analysts have downgraded the company’s stock this month. The company will "continue to invest in areas of the business we believe will create and accelerate growth," Chriss said in the letter. 

PayPal's layoffs are happening despite the company's strong growth throughout 2023. The company's revenue as of September 2023 was $7.42 billion, an increase of more than eight percent compared to its revenue a year before. It beat earnings expectations and reported a "double digit growth" in the number of transactions that happened over its platform. The Information noted that Chriss, who took over as the company's CEO in September 2023, said in PayPal's last earnings call in November 2023 that its costs were "too high" and were "slowing us down."

This article originally appeared on Engadget at https://www.engadget.com/paypal-is-laying-off-2500-employees-214628203.html?src=rss

Amazon terminates $1.4 billion iRobot acquisition after EU veto threat

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Amazon and iRobot, maker of the Roomba vacuum line, just announced that they would be dropping their proposed merger. The potential acquisition was announced back in August of 2022 and was immediately the target of antitrust watchdogs, particularly in the EU. The European Commission (the EU's executive branch) officially announced it was looking into the $1.4 billion dollar deal last July and it raised formal concerns over the potential impact on competition in November. 

iRobot also just announced a large round of layoffs now that the deal isn't going through. The company says it is laying off about 350 employees, which represents 31 percent of iRobot's workforce. Colin Angle, founder, chairman of the iRobot board of directors and CEO is also stepping down as chairman and CEO, effective today.

While the companies didn't mention the pressure from the EU specifically, Bloomberg notes that a veto looked likely. And while that might not have immediately killed the deal, Amazon and iRobot appear to have decided to shut things down completely rather than work through any proposed changes to make the deal more palatable to regulators. The deal was also said to be under scrutiny from the FTC here in the US, but it never quite reached the level of attention it was receiving from the EU. 

Unsurprisingly, Amazon's statement on the matter blasts regulators for the "innovation" that would come with Amazon scooping up yet another company. "This outcome will deny consumers faster innovation and more competitive prices, which we're confident would have made their lives easier and more enjoyable," said Amazon SVP and General Counsel David Zapolsky in a statement. "Mergers and acquisitions like this help companies like iRobot better compete in the global marketplace, particularly against companies, and from countries, that aren't subject to the same regulatory requirements in fast-moving technology segments like robotics."

iRobot's statement was more muted. "The termination of the agreement with Amazon is disappointing, but iRobot now turns toward the future with a focus and commitment to continue building thoughtful robots and intelligent home innovations that make life better, and that our customers around the world love," said former CEO Colin Angle.

Earlier in January, the European Commission was said to have warned Amazon that the deal was on thin ice. However, according to Reuters, the company declined to offer any potential remedies to soothe the bloc's concerns over the acquisition. As outlined in the original agreement, Amazon is paying iRobot a $94 million termination fee now that the deal is dead.

This isn't exactly the first time Amazon and the EU have butted heads. They previously squared off over the company's handling of third-party seller information. In 2022, the two sides reached an agreement over Amazon's treatment of third-party sellers.

This article originally appeared on Engadget at https://www.engadget.com/amazon-abandons-14-billion-irobot-acquisition-after-eu-veto-threat-140155112.html?src=rss