SAN ANTONIO -- Product shortages are “day to day, product by product,” ProSource CEO Dave Workman told a press briefing Wednesday during group’s summer show. He ticked off supply chain challenges facing manufacturers, saying, “You can’t get it out of China. If you get it out of China, it sits in the dock in Long Beach [California] or wherever; you can’t get it offloaded.”
Rebecca Day
Rebecca Day, Senior editor, joined Warren Communications News in 2010. She’s a longtime CE industry veteran who has also written about consumer tech for Popular Mechanics, Residential Tech Today, CE Pro and others. You can follow Day on Instagram and Twitter: @rebday
ON Semiconductor shares reached a 52-week high at $45.18 in morning trading Monday after the company reported record earnings above expectations for Q2 at $1.67 billion, a 38% year-on-year bump. The stock closed 11.7% higher at $43.64. CEO Hassane El-Khoury said on an earnings call he expects more supply constraints through first-half 2022. ON is seeing growing demand for its automotive and industrial market products, said El-Khoury, saying the company is focusing on gross margin improvement within a strategy of “manufacturing footprint rationalization and product portfolio rationalization.” That includes looking ahead at “which products are we going to grow in and which products are legacy where we’re not going to be investing in.” ON is shifting to high strategic products “where we want to play.” The company is looking at categories that are starting to grow and will maintain growth over five-10 years. “When you have fab-filler products, which are low-value, discrete, commoditized products, you keep shoving them in the fab and they go up and down with the market,” he said. “We’re moving away from that,” said the executive, “to strategic, high-value products that are going to grow over time, and that capacity has been taken away from the discrete, commodity products that caused that volatility.” In focusing only on products with a growth trajectory, “whatever demand does, it’s going to be growth. Maybe it’s not high growth, but it’s still growth.” Q3 revenue outlook is $1.66 billion-$1.76 billion.
Universal Electronics Inc. is positioned to benefit from TV OEMs’ shift from low-margin remote controls to higher-margin chips and embedded software in new products that broaden its addressable market, Colliers' Steven Frankel wrote to investors Monday. UEI reports Q2 Thursday. Colliers will be looking for an update on supply chain constraints, which management said on the Q1 call could have an impact on Q2 revenue. UEI “continues to face challenges and has been unable to deliver consistent year-over-year revenue growth,” said the analyst. The company has been “battling headwinds from the pandemic, a mix shift from finished remotes to higher margin software/chips and the de-emphasis of some lower margin products,” said Frankel. Colliers modeled UEI’s Q2 revenue at $157.9 million vs. the company’s guidance of $153 million-$163 million. Frankel cited some MVPDs’ strategy to push consumers toward apps rather than set-top boxes and referenced UEI’s Android and Apple TV solutions. He noted a Sky Brasil Android set-top box/voice remote combo and a Deutsche Telekom offering that pairs an Apple TV with UEI’s remote. Gross margin expansion is one of the hallmarks of UEI’s transition as it shifts from finished remotes to software and chips and ramps up licensing of additional software offerings such as those seen in 2021 LG TVs, he said.
Target became the latest major retailer to institute new masking rules in response to the surge in delta variant COVID-19 cases, saying Monday that employees in high-risk areas will be required to mask up beginning Tuesday.
Amazon shares fell 6.7% in morning trading Friday on lower-than-expected Q2 revenue and a tempered Q3 outlook. The company’s results for the quarter ended June 30 were “softer than expected” at $113 billion, the midpoint of guidance and 1.8% below consensus, Cowen analyst John Blackledge wrote investors Friday. “Higher consumer mobility” affected e-commerce demand, he said.
CEDIA Expo is among 86 trade events Emerald Holding plans to stage in second half 2021, the most in its history, as the show producer looks to salvage a year clobbered by COVID-19 postponements, said CEO Herve Sedky on the company’s Q2 earnings call Friday. The company canceled all Q1 live events except Surf Expo in Orlando, which had 50% attendance, and nearly all live events in Q2. It held two smaller shows in Florida, Sedky said.
Dolby’s licensing, products and services revenue continues to be affected by COVID-19 and implications on future operations results “remain uncertain,” said the company’s Thursday fiscal Q3 2021 earnings release. “The volume of shipments, aggregated across various end markets and devices, continues to be impacted and difficult to predict because of economic uncertainty due to COVID-19.”
User experience will be increasingly important as competition heats up in the streaming video market, Parks Associates’ virtual Future of Video conference was told Wednesday. “Eventually there’s going to be user fatigue from being subscribed to so many services,” said Parks analyst Paul Erickson.
Apple recorded double-digit revenue growth, despite supply constraints, across all product and service categories for fiscal Q3, the company reported Tuesday for the quarter ended June 26. It set a June quarter revenue record, rising 36% to $81.4 billion.
Spotify fell short of its monthly average user guidance for Q2 on “ongoing COVID-19 headwinds” and a “temporary issue” with sign-ups on a third-party platform, said CEO Daniel Ek on a Wednesday earnings call. MAUs grew 22% year on year, 3% sequentially, to 365 million.