Post-earnings stock watch: Intel and eBay down, SanDisk up

We take a look at three Silicon Valley big movers on the stock markets today — Intel, eBay and SanDisk — a day after they reported earnings:

• First, Intel isn’t having a very happy 45th birthday — at least on the Nasdaq. Shares of the Santa Clara-based chipmaker, which issued a warning about continued challenges in the PC industry along with its earnings report Wednesday,  are down nearly 4 percent to about $23.25 as of this post.

As the Merc’s Steve Johnson reported, two-thirds of Intel’s revenue comes from PC chip sales — and sales of personal computers continue to fall amid the rise of tablets and smartphones. In the past year or so, Intel finally arrived to the mobile-computing party, but it has to catch up with market leader ARM. The valley company’s progress in low-power chips gives it a good chance, an analyst told Johnson in a recent story. “It’s a good race now,” said Jim Mielke, vice president of engineering for ABI Research. And its entry into mobile could be costly. Still, other analysts point out that mobile chips sell for a fraction of those for PCs, which could drastically affect revenue.

• Speaking of Wall Street woes, eBay shares are falling sharply today after the San Jose company on Wednesday issued a forecast for the current quarter that fell short of expectations. In addition, second-quarter revenue rose 14 percent but net income fell 8 percent in the same period a year ago. PayPal, the San Jose company’s payments company, continued to grow, and changes to eBay’s marketplace seemed to have helped.

But as eBay’s shares fall almost 7 percent to about $53.40 as of this post, the company seems to be a victim of high analyst expectations that the growth that has been part of CEO John Donahoe’s turnaround efforts in the past couple of years will continue.

“People were hoping this would be a quarter for eBay to beat some of its numbers, but it came in pretty much as expected or was short in a few places,” said Kerry Rice, a Needham analyst, according to the Wall Street Journal.

• A valley company that’s seeing its shares rise sharply today is SanDisk. Shares are up more than 3.75 percent to about $61.70 as of this post. The Milpitas maker of flash memory reported results that beat expectations Wednesday, as Biz Break noted. Higher demand from mobile devices have caused flash memory chip prices to climb after a slump last year, according to Reuters. And SanDisk makes NAND memory chips that are used in SSDs, or solid-state drives that are found in ultra-thin mobile computers. Demand for SSDs is reportedly expected to grow 75 percent this year.


Photo by Reuters


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