Instant View: IBM hikes 2012 profit view; Qualcomm misses

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

Commentary:

IBM (IBM.NY)

TRIP CHOWDHRY, ANALYST, GLOBAL EQUITIES RESEARCH

"IBM's miss on the top line is related to the macro conditions. It suggests that revenue will be a challenge for all technology companies. Most technology companies close their big deals in the last weeks of the quarter. Only the first month of this quarter was okay. The last two months were terrible.

"This weakness is a buying opportunity for stocks like IBM, HP , Apple , Google and VMware . They are getting impacted by macro-economic conditions. But there is no market-share loss. You should buy stocks like this when times are bad and use them as a buffer."

BRIAN MARSHALL, ANALYST, ISI GROUP

"They did better on margins, expenses and share buybacks. So they delivered EPS upside. We continue to think that that is going to be challenging to continue to deliver upon, in the face of revenue deterioration.

"They're big, so there's limited opportunities. Two, currency headwinds were much greater than what they forecasted. And three, 60 percent of their revenue come from aboard."

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 and Noel Randewich in San Francisco and Jim Finkle in Boston)

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