Looking at the flurry of quarterly results coming out of Europe's big tech companies this week, it's hard to tell which way the spring weather is headed. Some companies are catching a bit of sun, and others are just getting rained upon.
Take Koninklijke Philips Electronics N.V. , for instance. The Dutch company surprised everyone with better-than-expected first-quarter numbers. One-time gains and much-awaited improvements within its consumer and healthcare divisions boosted Philips' results and gave some hopeful signs that previous management changes were working.
Coming off a $211 million (160 million euro) loss in the fourth quarter, the company this time reported
that first-quarter net profit jumped 80 percent to 249 million euro, while sales rose 7 percent to 5.6 billion euro.
Over in Germany, engineering conglomerate Siemens AG (NYSE: SI; Frankfurt: SIE) also reported revenue growth in its fiscal 2012 second quarter. The company said sales were up 9 percent year-over-year to 19.3 billion euro, buoyed by a strong order backlog.
However, the good news was shaded by storm clouds; new orders were down 13 percent, and income was "considerably below the prior year due to burdens in the Power Transmission Division and an equity investment loss at NSN," according to the company statement above. "As expected, the second quarter was not easy," noted Siemens President and CEO Peter Löscher.
Seeing the approaching storm, the company also slashed its full-year profit forecast because it incurred another major charge associated with delays in offshore wind power projects, Reuters reported.
In Switzerland, chipmaker STMicroelectronics NV (NYSE: STM) took a hit on its first-quarter revenue as it continues to restructure a struggling wireless business with partner Ericsson. Sales fell 8 percent to $2.02 billion on a sequential basis, and its net income loss widened to $176 million from an $11 million loss in the previous fourth quarter.
President and CEO Carlo Bozotti commented further on the company's performance in a statement:
ST's wholly-owned businesses in the first quarter posted a sequential decrease of 3%, better than historical seasonality, benefiting from growth in the Automotive segment and the Analog, MEMS and Microcontrollers sector. Our Wireless segment losses weighed heavily on our quarterly results again. However, ST-Ericsson has announced today its new strategic direction and renewed business model with a key objective to significantly reduce its operating losses throughout 2012 as it moves towards leadership and improved financial returns.
Up north, there was better news from the United Kingdom, the base of semiconductor intellectual property provider ARM Ltd. (Nasdaq: ARMHY; London: ARM). The company's pre-tax quarterly profit soared to $100.19 million (£61.9 million), up 22 percent from £50.7 million in the year-ago period. Revenues were $209.4 million, up 13 percent on $185.5 million in the same quarter a year before.
The company said
it saw growth in shipments of chips based on its processor technology, with 1.1 billion chips shipped into mobile phones and mobile computers, similar to a year ago, and 800 million chips shipped into consumer and embedded digital devices, up 15 percent year-on-year.
Despite the sunny patches, companies here are generally remaining cautious in their overall 2012 outlooks. With continued uncertainty about the European debt crisis, the lag effect of the recession, and the slowdown in spending in key economic segments, many executives are still nervously hedging their forecasts. It looks as if it's high time to keep the rain boots ready. There will be some sloshing around in muddy terrain for a while longer.