Instant View: IBM hikes 2012 profit view; Qualcomm misses targets

Qualcomm Inc , also reporting Wednesday, missed quarterly revenue and earnings targets and pulled back on estimates for mobile device shipments in 2012.

Commentary:

IBM (IBM.NY)

KIM FORREST, SENIOR ANALYST, FORT PITT CAPITAL GROUP

"I know they missed on the top line, but a lot of that is currency. I don't think a lot of the people who forecast are all that great about figuring out the currency equation.

"The headline here is really margins. I expected them to be more in-line with last year. For example, Global Technology Services was 36.3 percent and last year it was 34 percent. It's really hard to manage a bench of people and get money out of them. Another example was Global Business Services. That came in at 30.7 and last year it was 28.9.

"The only area where I am kind of concerned is hardware, because I see the margins declining."

RICHARD SICHEL, CHIEF INVESTMENT OFFICER, PHILADELPHIA TRUST

"It's very nice that they beat expectations on earnings. I would say the look-ahead is really what investors are looking for. You get a very credible forecast this way, and what they said was more positive than how people have been feeling lately."

AMIT DARYANANI, RBC CAPITAL MARKETS

"They modestly missed on the revenue line, partially due to forex, and slightly on software hardware revenue.

"But the big message is they beat EPS handily and they're raising the full-year EPS target, and that's probably enough for the stock to keep working. It's a sign that this company can keep executing despite the revenue headwinds they have."

Qualcomm:

JAMES FAUCETTE, ANALYST, PACIFIC CREST SECURITIES

"The slight miss and slight guide-down for the September quarter was generally about as expected. The company reassured on the other hand that the ramp in 28-nanometer chips is happening and they expect a strong December quarter.

"They said that since June 24, they have repurchased about $617 million worth of stock. The other positive thing is the ASPs of devices shipped in the March quarter, on which they recognized royalties in the June quarter, were much higher than what people and the company had estimated. That's good news in the long run as well."

ED SNYDER, ANALYST, CHARTER EQUITY

"It's a mess, well below expectations on revenue guidance, and chip sales much lower than people expected. It could be a slowdown in demand, it could be a delay in the iPhone 5. It could be 28 nm supply."

(Reporting by Malathi Nayak, Alexei Oreskovic, Noel Randewich and Jim Finkle)

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