“Michelin & Cie. (ML), Europe’s largest tiremaker, said first-quarter revenue fell 8.1 percent as a recession reducing car sales in its home region widened to hurt demand at bulldozer and military-plane manufacturers.

Sales dropped to 4.88 billion euros ($6.36 billion) from 5.3 billion euros a year earlier, Clermont-Ferrand, France-based Michelin said yesterday in a statement. Revenue missed the 4.97 billion-euro average of four analyst estimates compiled by Bloomberg. The tiremaker, reiterating forecasts of “steady” volume and “stable” earnings for 2013, said it may look at reorganizing in the absence of a market recovery.

Demand for earthmovers is “falling sharply” in Europe and North America, and sales of farm tractors and defense aircraft are also declining, Michelin said. The manufacturer is seeking more growth outside Europe and marketing more so-called specialty tires used on large vehicles amid a car-market contraction that French auto producer PSA Peugeot Citroen (UG)expects at as much as 5 percent this year.

“If volumes stay at the levels at which they are today, that would imply some European restructuring,” Chief Financial Officer Marc Henry said on a conference call with analysts. “This is under scrutiny of course, but nothing is said yet.”

The shares dropped as much as 2.77 euros, or 4.6 percent, to 57.23 euros and were down 2.3 percent as of 9:22 a.m. in Paris trading. The French manufacturer has declined 18 percent this year, valuing the company at 10.8 billion euros.

Shrinking Market…”

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“Through Friday, 104 companies (33% of the market cap) of the S&P 500 have announced there Q1 2013 financial results.

While it’s still very early into the earnings announcement season, the early tally is not very encouraging.

The analysts at Goldman Sachs have compared the earnings announcement surprises to the surprises seen in the last 40 quarters (10 years).

“Positive earnings surprises are tracking below average this quarter (36% vs. 47%),” said Goldman’s David Kostin. “The percentage of firms missing earnings estimates by one standard deviation or more is also below the 40 quarter average (13% vs. 15%) implying more firms have reported results in- line with consensus expectations.” …”

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“Netflix (NFLX) investors gave the streaming video service rave reviews for its first-quarter results late Monday, driving shares up 24% in after-hours trading.

The Los Gatos, Calif.-based company earned 31 cents a share excluding items, vs. analyst expectations for 19 cents. In Q1 2012, Netflix lost 8 cents a share.

Revenue rose 18% to $1.024 billion, edging past the Street’s forecast for $1.017 billion.

Netflix added over 3 million streaming subscribers in Q1, bringing its total to more than 36 million worldwide. U.S. streaming customers rose by 2.03 million to 27.91 million paid members. In international markets, Netflix added 1.02 million subscribers to 6.33 million.

Netflix shares rose 24% in late trading to 216.46, which would be their best level since late 2011. During the regular session, the stock rose nearly 7%….”

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“DALLAS (AP) — Chipmaker Texas Instruments Inc. said Monday that its net income rose 37 percent in the first quarter as lower costs offset a revenue decline.

Profit grew to $362 million, or 32 cents per share, from $265 million, or 22 cents per share. Revenue slid 8 percent, to $2.89 billion from $3.12 billion.

Analysts were expecting net income of 31 cents per share and $2.85 billion in revenue, according to FactSet.

The company’s costs to make chips fell 5 percent to $1.51 billion, research and development spending slid 18 percent to $419 million and acquisition expenses fell 44 percent to $86 million….”

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“CHICAGO (Reuters) – Caterpillar Inc cut its full-year outlook for 2013 on Monday to reflect a drop in demand for heavy equipment from its mining customers.

The Peoria, Illinois-based company said it now expects to a report a profit of $7 a share on sales of $57 billion to $61 billion in 2013. That was down from a previously estimated profit of between $7 and $9 a share on sales of $60 to $68 billion. The company said the cut was necessary “because our expectations for mining have decreased significantly.”

The news came as the company, the world’s largest maker of construction and mining equipment, reported a weaker-than-expected first-quarter profit….”

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“PAWTUCKET, R.I. (AP) — Hasbro says its first-quarter loss widened as the toy maker absorbed heavy restructuring charges and foreign exchange rates flattened its international revenue. The performance still topped Wall Street expectations.

The Pawtucket, R.I., maker of Transformers and Monopoly says it lost $6.7 million, or 5 cents per share, in the three months ended March 31. That compares with a loss of $2.6 million, or 2 cents per share, a year ago.

But Hasbro Inc. earned 5 cents per share when a restructuring charge is excluded. Analysts expected adjusted earnings of 4 cents per share….”

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“HOUSTON (AP) — Halliburton says it lost $18 million in the first quarter on litigation-related charges related to the 2010 Gulf of Mexico oil spill. But it made money if the unusual items are excluded, and beat Wall Street expectations.

The oil services company’s loss attributable to common shareholders amounted to 2 cents per share. That compares with net income of $627 million, or 68 cents per share, a year earlier.

Excluding one-time items, however, the company posted adjusted earnings of 67 cents per share. That beat the 57 cents that analysts expected…”

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“Flextronics International Ltd. (FLEX), a supplier of cameras and battery charges to Apple Inc. (AAPL), is seeking Chinese, Japanese and Korean car makers as customers to boost growth in its automotive business.

The Singapore-based company aims to double its revenue from the High Reliability Solutions group, which includes automotive, medical, aerospace and defense, every three to five years, Paul Humphries, president of the division, said in an interview in Shanghai today. Sales for each business are expected to increase between 10 percent and 20 percent annually, he said.

Flextronics, which also makes lighting and entertainment systems for automakers, is increasing focus on Asian car makers after its revenue declined for five straight quarters. Total vehicle sales in China this year are forecast by the country’s industry group to surpass 20 million units for the first time….”

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“Hermes International SCA (RMS), the French maker of Kelly handbags, reported the slowest revenue growth in more than three years because of diminishing gains in the leather-goods unit and a drop in watch sales.

Revenue in the first quarter of 2013 climbed 10 percent to 856.8 million euros ($1.1 billion), Paris-based Hermes said today in a statement. Analysts predicted 854 million euros, according to the average of five estimates compiled by Bloomberg. Excluding currency swings, sales advanced 13 percent, the least since the last three months of 2009.

Weaker performances in leather-goods and watches took the shine off a stronger showing from the clothing unit. Leather- goods sales, Hermes’s biggest source of revenue, gained 7.3 percent excluding currency swings, about half the rate of the year-earlier quarter and the slowest since the third quarter of 2007. The slowdown may have been caused by reduced output, said Rodolphe Ozun, an analyst at Bank of America Merrill Lynch.

“The slowdown in leather goods highlights in our view the normalization of production in this segment and should continue in the coming quarters,” Ozun wrote in a report.

Hermes rose 1 percent to 251.30 euros at 11:15 a.m. in Paris, mirroring gains by stocks acrossEurope. That gave the saddle maker a market value of 26.5 billion euros.

All product categories posted revenue growth except tableware and watches, Hermes said. Sales of timepieces declined 5.3 percent, excluding currency shifts, as the Chinese market slowed at the start of the year, Hermes said.

Chinese Demand…”

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“China Mobile Ltd. (941), the world’s largest phone company by subscribers, reported its weakest profit growth in three quarters as higher costs eroded gains from an increase in users of high-speed network services.

Net income rose to 27.9 billion yuan ($4.5 billion) from 27.8 billion yuan a year earlier, the Beijing-based carrier said in a statement to the Hong Kong Stock Exchange today. Profit was expected to be 28 billion yuan, based on the median of five analysts’ estimates compiled by Bloomberg News.

Chief Executive Officer Li Yue is fighting to maintain his lead in smartphone users over China Unicom (Hong Kong) Ltd. (762) and China Telecom Corp. by subsidizing handsets for third-generation data users and adding fourth-generation services. The company last month said it will bear costs for the TD-LTE network, or 4G network, previously borne by its state-owned parent, boosting the listed unit’s capital spending 49 percent to 190.2 billion yuan this year….”

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“McDonald’s Corp. (NYSE: MCD) reported first-quarter 2013 results before markets opened this morning. For the quarter, the fast-food restaurant chain posted diluted earnings per share (EPS) of $1.26 on revenues of $6.61 billion.

In the same period a year ago, the company reported EPS of $1.23 on revenues of $6.55 billion. First-quarter results also compare to the Thomson Reuters consensus estimates for EPS of $1.27 and $6.59 billion in revenues.

Globally, same-store sales in the first quarter fell 1%, and consolidated net income also fell 1%. U.S. same-store sales fell 1.2% and were down 1.1% in Europe and 3.3% in Asia. Results in China were “negative,” according to the company.

McDonald’s has an opportunity to improve its sales in China while competitor Yum! Brands Inc. (NYSE: YUM) struggles with both tainted chicken and bird flu at its KFC stores. But somehow, the company is flubbing it.

The company’s CEO said:

While the Company’s results for the quarter reflected difficult prior year comparisons and the ongoing impact of global economic headwinds, we continue our efforts to build market share and deliver sustained profitable growth for all stakeholders….”

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“(Reuters) – Strong sales to aviation customers helped General Electric Co’s first-quarter revenue beat Wall Street expectations on Friday, assuaging fears of a miss after a lukewarm report on March U.S. factory activity.

The world’s biggest maker of jet engines and electric turbines said revenue rose slightly to $35 billion, surpassing the $34.51 billion analysts had expected, according to Thomson Reuters I/B/E/S.

“That is a beat on revenue, and that’s important because the Street has been very worried about revenue numbers at industrial firms because the quarter appears to have tailed off in March,” said Jack DeGan, chief investment officer at Harbor Advisory Corp in Portsmouth, New Hampshire, which owns GE shares.

The Institute for Supply Management said earlier this month that U.S. factory activity grew at the slowest rate in three months in March, suggesting the economy lost some momentum at the end of the first quarter.

While investors and analysts await more information on sales from GE Chief Executive Jeff Immelt on an earnings conference call, GE said in a statement that orders from aviation customers jumped 47 percent and orders from energy customers rose 24 percent in the quarter.

GE’s order backlog – a closely watched indicator of future sales – rose to $216 billion from $210 billion in the fourth quarter of 2012. Backlog can be a positive sign that customers are willing to wait in line for a company’s products, or a sign that a company is having a hard time meeting demand. GE’s backlog has grown consistently in recent quarters….”

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“Microsoft (MSFT) shares rose 3% in after-hours trading Thursday after the software leader released March-quarter earnings that beat views on slightly less-than-expected sales.

The company also announced its chief financial officer is leaving at the end of the current quarter.

Microsoft earned 72 cents a share, up 20% from the year-earlier quarter and besting Wall Street’s target of 68 cents, for its fiscal third quarter. Sales rose 18% to $20.49 billion, just shy of the $20.53 billion analysts expected….”

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“SAN FRANCISCO (AP) — Google’s latest quarterly results provided further proof that the Internet search leader is figuring out how to make more money as Web surfers migrate from personal computers to mobile devices.

The first-quarter numbers released Thursday show that a recent decline in Google’s average ad prices is easing. That’s an indication that marketers are starting to pay more for the ads that Google distributes to smartphones and tablet computers. The company expects that trend to continue as it changes its pricing system and as mobile devices emerge as the most effective way to reach consumers.

In another encouraging sign, the Motorola cellphone business was less of a burden than it has been since Google bought it for $12.4 billion nearly a year ago.

Meanwhile, Google’s core operations, such as Internet search, maps, video and email, remain reliable moneymakers.

Those factors, coupled with an unusually low tax rate, produced earnings that exceeded analyst estimates and pleased investors. Google’s stock gained $11.84, or 1.6 percent, to $777.75 in extended trading Thursday after the report came out.

As with most major technology companies, Google’s future success is likely to hinge on its ability to adjust to an accelerating shift from computers controlled by keyboards and mice to mobile devices that respond to the touch of a finger and are usually within a person’s reach….”

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“Honeywell International Inc. (HON), the maker of cockpit controls and thermostats, reported first- quarter profit that rose more than analysts predicted on increased demand for energy-related services.

Net income climbed to $966 million, or $1.21 a share, compared with $823 million, or $1.04, a year earlier, the Morris Township, New Jersey-based company said today in a statement. The per-share earnings surpassed the $1.14 average of 23 analysts’ estimates compiled by Bloomberg. The company also raised the low end of its 2013 earnings target.

A surge in U.S. natural gas production and in companies building petrochemical plants is driving demand for Honeywell’s energy services. That’s making up for a decline in the company’s automobile turbocharger business, which depends on European demand for cars and trucks….”

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“SAP AG (SAP), the largest maker of business-management software, reported first-quarter software sales that trailed analysts’ estimates after the company failed to close contracts in the Asia-Pacific region.

Sales of new software licenses, an indicator of future revenue, rose 3 percent to 657 million euros ($859 million), Walldorf, Germany-based SAP said today. That was slower than the 9 percent growth in the previous quarter and fell short of the 726 million-euro median of estimatescompiled by Bloomberg.

Operating profit adjusted for some items rose 8 percent to 901 million euros, also missing estimates. SAP joins other software makers in reporting slowing traditional license sales. Oracle Corp. on March 20 reported revenue and profit that fell short of analysts’ estimates as demand for Web-based programs hurt sales of its hardware and on-premise software.

“Still a notch better than Oracle’s straight miss and negative newsflow from other IT bellwethers,” Thomas Becker, an analyst at Commerzbank AG in Frankfurt, said in a note. “Not a great quarter either, but Q1 is always the smallest quarter and does not establish a trend.”

SAP shares declined the most since Jan. 15, dropping as much as 3.5 percent to 57.55 euros and trading at 58.07 euros as of 9:35 a.m. in Frankfurt today. The stock has gained 18 percent in the past 12 months, valuing the company at 71.4 billion euros.

Leadership Transitions…”

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“NEW YORK (AP) — Morgan Stanley says profit and revenue dipped in the first quarter. Results beat Wall Street’s expectations, but the stock still dipped in pre-market trading.

Revenue from the investment bank slipped, while revenue from asset management rose.

Earnings totaled $1.2 billion, down about 12 percent from a year earlier. Per share, those earnings amounted to 61 cents, beating the 57 cents expected by analysts polled by FactSet.

Revenue totaled $8.5 billion. That was down 5 percent from a year earlier, but it beat analysts’ expectations of $8.3 billion.

The earnings and revenue exclude the effect of an accounting charge related to the value of the bank’s debt.

The stock dipped in pre-market trading, down 7 cents to $21.40.”

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“NEW YORK (MarketWatch) — Verizon Communications Inc. VZ +1.53% reported first-quarter net profit rose 15.8% to $1.95 billion, or 68 cents per share, from $1.69 billion, or 59 cents per share, a year earlier. Revenue rose 4.2% to $29.42 billion from $28.24 billion, the company said Thursday. Analysts had expected profit of 66 cents a share on revenue of $29.55 billion. The company said it added a net 677,000 retail postpaid customers, up 35% from a year earlier, and had a 1.01% churn rate for that category. Verizon shares were higher in premarket trading.”

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“–Core1 EPS $0.77, up 12 percent. Reported EPS $0.69, a decline of 3 percent reflecting the impact of the devaluation of net monetary assets in Venezuela
–Organic1 revenue grew 4.4 percent. Reported net revenue increased 1 percent reflecting the impacts of foreign currency translation and structural changes
–Core operating margin expanded 80 basis points. Reported operating margin declined 70 basis points reflecting the Venezuela devaluation
–Company expects to return approximately $6.4 billion to shareholders through dividends and share repurchases in 2013
–Company reaffirms 7 percent core constant currency1 EPS growth guidance for 2013…”

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“Finnish mobile phone maker Nokia trimmed its losses in the first quarter, thanks to stronger Lumia smartphone sales.

But the shares fell 10.7 percent in Helsinki because of weaker than expected guidance for the second quarter.

Nokia, which has fallen behind Samsung and Apple in the smartphone race, said it sold 5.6 million units of Lumia handsets in the first quarter, up from 4.4 million in the previous quarter….”

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