Consumer revenue at Dell Technologies for Q1 ended May 1 was down 5%, “as we shifted supply to direct from retail” with the onset of the COVID-19 pandemic, said Chief Financial Officer Tom Sweet on a Thursday investor call. Dell’s consumer-direct orders were up nearly 40% in the quarter, while consumer retail orders were down 37%, he said. April visits to Dell’s online store were up 77% from a year earlier, “driven largely by interest in remote work offerings,” said Chief Operating Officer Jeff Clarke. In the “new normal,” society is realizing “that work isn't a destination, rather it's something many of us can do anywhere, anytime,” he said. “We are solving customer issues remotely with great success.” The stock closed 8.9% higher Friday at $49.64.
A chip company that supplies carriers and others expects 5G and bandwidth demand to keep increasing post-pandemic, its CEO said. Marvell expects the demand for bandwidth “to continue to grow stronger,” said CEO Matt Murphy on a Thursday investor call. “Major cloud and service providers are facing unprecedented demand for their services as a result of so many people working from home and are scrambling to add capacity to their networks. 5G has become a strategic priority for many nations.” Quarterly sales rose about 5% to $693.6 million from the year-ago period. That's about $14 million above the midpoint of its March 4 guidance, despite COVID-19's “massive disruption,” Murphy said. Q1 ended May 2. “The impact of COVID-19 turned out to be greater than expected in our storage business and lower than expected in our networking business,” he said. Marvell experienced stronger than expected demand from its data center and 5G infrastructure “end markets,” he said. The company just started shipping 5G products to Samsung. “We are still at the very beginning of the industry transition from 4G to 5G,” Murphy noted. His company's stock closed up 8.8% Friday at $32.62.
Coherent remains optimistic about “the pending upgrade cycle” to 5G smartphones, said CEO Andy Mattes. “The linkage between thin-flexible OLED screens and 5G capability seems high, driven by the need for larger batteries to occupy more of the device volume as a requirement for powering the shorter-range, higher-frequency antennas.” The chief of the supplier of laser-based microelectronics to panel makers spoke to investors Wednesday evening following results for fiscal Q2 ended April 4.
The increase in demand for Poly headsets induced by COVID-19 stay-at-home orders was “so strong” in March and April it “depleted” inventories, said interim CEO Bob Hagerty on a fiscal Q4 call Wednesday. The former Plantronics markets wired and Bluetooth headsets, plus videoconferencing solutions. Q4 ended March 28. The company expanded “dual sourcing” of high-volume headsets and “secured additional capacity at our contract manufacturers,” the CEO said. Poly still expects to exit Q1 late June “with an elevated backlog” of headset orders, he said. Supplies of some of the highest-volume headsets “may not be fully caught up” even through fiscal Q2, said Chief Financial Officer Chuck Boynton. The stock closed down Thursday 14% at $12.53.
COVID-19 “macroeconomic and supply chain challenges” sent HP Q2 revenue down 11% to $12.5 billion, said CEO Enrique Lores on a Wednesday investor call. “While some areas performed very well as people shifted to work from home, others suffered, and we faced supply chain disruptions.” The quarter ended April 30. Though the Chinese production that was shut down after the Lunar New Year began to “ramp” in late February, “we also experienced disruptions to operations in Southeast Asia and other parts of the world as the pandemic spread,” said Lores. Production was “largely back to full capacity” by early May, he said. Higher PC demand, combined with supply chain disruptions, “resulted in an elevated backlog, which we expect to work down during Q3," he said. “Manufacturing disruptions” prevented the company from keeping pace with the spike in consumer orders for “hardware and ink supplies,” said Lores. Consumer revenue in the quarter declined 16%, said Chief Financial Officer Steve Fieler. The stock closed 12% lower Thursday at $15.01.
Sharp's lawyers served documents electronically Thursday on Vizio, TPV and Xianyang CaiHong Optoelectronics in connection with the International Trade Commission’s newly opened Tariff Act Section 337 investigation into Sharp allegations that Vizio and its suppliers are infringing five Sharp LCD display patents (see 2005210041). The electronic dissemination of documents was in keeping with the ITC’s March 16 order temporarily waiving its requirement on paper filings due to the COVID-19 pandemic, said a certificate of service (login required) in docket 337-TA-1201. Vizio and its suppliers have until June 10 to file responses to the notice of investigation.
The Starz streaming business is “thriving” in the stay-at-home “environment,” said Lionsgate CEO Jon Feltheimer on a fiscal Q4 call Thursday. Lionsgate bought Starz for $4.4 billion nearly four years ago (see 1606300069). Starz finished the year ended March 31 with 6.8 million paid over-the-top U.S. subscribers, “well in excess of our projections," said Feltheimer. "It has continued its strong growth since then.” It had forecast reaching about 6 million OTT subs domestically by fiscal year-end, said Starz CEO Jeffrey Hirsch: “We were well past that number through the first two months of the quarter, and then it accelerated as we got into March.”
Lenovo’s PC manufacturing in China was one of the first in the industry to “resume full production” after the COVID-19 pandemic and achieved “daily, weekly and monthly production records in March,” said CEO Yang Yuanqing on a quarterly call Tuesday. “This helped us meet the strong PC demand, driven by work from home and study at home due to the lockdown.” Lenovo’s PC volume for the year “outgrew the market” by more than 4 percentage points, helped by an 18% sales volume increase in North America, he said. The “clear trend” during global shelter-in-place orders is toward “one PC per person” from one or two per family, said Chief Operating Officer Gianfranco Lanci. “This is going to last,” because people “will continue to work from home even after the crisis,” he said.
COVID-19 disruptions in the Chinese supply chain caught some U.S. importers off guard, Microsoft’s top logistics point man told an IHS Markit webinar. The vast majority of them had an “urgent, knee-jerk reaction,” said David Warrick, Microsoft general manager-global supply chain. “Most companies were not actually prepared for the size, scale or longevity” of the pandemic, he said Tuesday. It’s extremely difficult to navigate through the crisis “if you don’t have the visibility in the first instance,” said Warrick. “You have to understand what’s going on to be able to impact it and affect it.” Many companies before the pandemic shied away from building “visibility tools” into their supply chains because they feared “an enterprise-level investment,” said Warrick. “It feels like it’s millions of dollars that has to be done for a multiyear plan to be able to bring this type of technology to the fore.” But, such tracking is available in a “plug-and-play” fashion and can be installed as an “overlay” on existing supply chain “infrastructure,” said Warrick.
Though the tech sector is “not immune to the turbulent operating environment” of COVID-19, technology will be “what modifies the current weakness and drives new demand and business models post-pandemic,” said Analog Devices CEO Vincent Roche on a quarterly call Wednesday. Capacity was reduced at the chipmaker’s “back-end test and assembly sites” in the Philippines, Malaysia and Singapore when shelter-in-place mandates were ordered in mid-March, he said. “Once granted essential status, we acted quickly, yet responsibly, to ensure employee safety and improve our capacity.” The factories are running at “normal capacity levels” again, said Roche. “Post-pandemic supply chains will be reimagined and new ones will be built” that are more “flexible” and automated, he said. The stock closed up 7.8% at $114.57.