STEC design win in Dell ultramobile

According to storage news website blocksandfiles, STEC got a design win at Dell for a million units.

The Nine (NCTY) under pressure

A sell side firm is making a call that they'll lose the World of Warcraft license in 2010.

Semicaps

Buying some LRCX and KLAC long here. Nothing crazy. Just wanna be buying the weakness for now.

Charts getting me short here

Currency no longer a tailwind

A number of companies have benefited from the dollar weakness over the last several quarters. Dell, Google, IBM to name a few -- in fact, many of them would have missed revenue and earnings estimates if it hadn't been for the dollar weakness bolstering results.



Not as pretty a picture for them this quarter.

Something to think about.

Applied Materials (AMAT) 3Q:2008 results

The order outlook of up 2-10% for Q4 is better than the street anticipated. The company says it will be driven by foundry, flat panel and solar. They expect memory to trough in the October quarter and for 2009 memory spending to increase over 2008 levels.

Believe it or not, the group has had a good run already. Lam (LRCX) was $31 in late July, its $40 now. Pretty much since Novellus reported and it wasn't that terrible, the group has had a positive tone to it. I had been covering in front of the Novellus number, though I remain short Varian (VSEA).

Though the rallies seem aggressive in light of the ongoing pressures in memory, semicap investors play long ball -- they're looking a year out. Applied and Lam have both suggested the trough is here and that tends to bring out buyers. Furthermore, the peaking and subsequent downward trajectory in the commodity and cyclical markets may bring funds outside of technology into the semicaps as they seek a new cycle to ride.

I think the semicaps are closer to a near-term top than anything else but I suspect they're buys on weakness at this point.

The Nine (NCTY) 2Q:2008 results

Revenues were slightly better due to World of Warcraft strength. WoW grew to 91% of total revenues. Other sources of revenue at the company have failed to materialize. EPS came in 12 cents better entirely on non-operational items: better forex, lower tax rate, better interest income. In fact, they missed operating income estimates slightly.

Citigroup and Credit Suisse downgrade this morning citing dependence on WoW and lack of bargaining power at the license renegotiation table.

The Nine (NCTY) reporting tonight

They do online games but none really matter to revenue outside of World of Warcraft which makes up 90 percent of NCTY revenue. Their license for WoW ends pretty soon. Its expected that Activision Blizzard (ATVID) is going to negotate much less favorable terms for NCTY. Don't see why they wouldn't -- NCTY has no negotating power at all -- they're completely dependent. All the analyst models have WoW assumptions for 2009 -- though expectations have been scaled back somewhat.

In theory the olympics will be a drag on online gaming revenue for the month of August which could lead to a shortfall in near-term guidance.

To recap: The license expires at the end of the year. It's already in the models. If ATVID doesn't renew the license at all, NCTY would eventually go to zero.

Seems like bad risk/reward?

Freddie Mac (FRE) still sounds insolvent

Fair value of assets: -5.6 billion.
Dividend cut: 80%.
Proposed capital raise: $5.5 billion.
Value: Worthless.

There are some things money shouldn't buy.

Cisco Systems (CSCO) 4Q:2008 results

Cisco beat by a little on the top and the bottom line. They were constructive on enterprise spending and some analysts have suggested their tone is better. Service provider orders grew at 5%, down from last quarter's 6% and the high teens last year. They said book to bill was comfortably above 1 but drew on deferred revenue which shrunk by 165 mil. They also lowered growth forecasts by a percentage point on a year to year basis for the next two quarters and indicated economic uncertainty will be their bedfellow for the next several quarters.

The stock is rallying on this. I'm not going to be buying it. Good company. Now at that $40 billion dollar threshold -- its a lot harder to grow a 40 billion dollar company. I don't think their claims of 12-15% long-term growth are realistic.