Six Five Live Ep 41- A Thousand Eyes On Earnings (Citing Dell, Pure Storage, Salesforce, Qualcomm, HP Inc.)

Leading global tech analysts Patrick Moorhead (Moor Insights & Strategy) and Daniel Newman (Futurum Research) are front and center on The Six Five analyzing the tech industry’s biggest news each and every week and also conducting interviews with tech industry “insiders” on a regular basis. The Six Five represents six (6) handpicked topics that will be covered for five (5) minutes each. Welcome to this week’s edition of “The 6-5.” I’m Patrick Moorhead with Moor Insights & Strategy, co-host, joined by Daniel Newman with Futurum Research.

On this week’s show we will be talking:

  1. Cisco Acquires Thousand Eyes (Daniel) Cisco Deepens its Cloud and Internet Intelligence with Thousand Eyes 
  2. Dell Earnings (Pat) Dell Technologies Delivers Solid Q1 Amidst Global Pandemic
    1. https://twitter.com/PatrickMoorhead/status/1266107040189091853?s=20 
    2. https://twitter.com/PatrickMoorhead/status/1266110762201878541?s=20 
  3. Pure Storage Earnings (Pat) https://twitter.com/PatrickMoorhead/status/1266102521929568256?s=20 
  4. Salesforce Earnings (Daniel) How Salesforce will continue to grow amid the crisis, per analysts
    1. Salesforce (CRM) earnings Q1 2021
  5. Qualcomm WiFi-6 Announcements (Daniel) Qualcomm’s first Wi-Fi 6E chips are here
  6. HP Earnings (Pat) https://twitter.com/PatrickMoorhead/status/1265737171870330880?s=20

Disclaimer: This show is for information and entertainment purposes only. While we will discuss publicly traded companies on this show. The contents of this show should not be taken as investment advice.

ELECTRONICALLY-GENERATED TRANSCRIPT:

SUMMARY KEYWORDS

company, salesforce, cloud, pat, earnings, business, cisco, dell, vmware, broadcom, qualcomm, acquisition, big, important, wi fi, talk, customers, technology, run, pure

SPEAKERS

Daniel Newman, Patrick Moorhead

Daniel Newman  00:01

Welcome to this week’s edition of the Six Five Podcast. I’m your host today, co-host you may say or host with the most guy that still sounds dumb. Daniel Newman a principal analyst and founding partner at Futurum Research joined by my always fun and esteemed colleague and co host and competitor but not really. Mr. Patrick Moorhead of Moor Insights & Strategy. Patrick, how are you doing today,

Patrick Moorhead  01:34

I’m doing great, and thank you for calling me like funny, because nobody else I think thinks I’m actually funny and or fun to be around so we just use me everywhere we go from now on.

Daniel Newman  01:50

Yeah, you know what, when you’re a tech dork like I am, and you get to hop on and talk tech with another tech dork. You can have a whole lot of fun so yes for everybody out there that is part of our awesome community of six five listeners, Patrick and I don’t only do this because it’s a great job that you know helps us build wonderful companies, both of our respectively. But we also really genuinely love the technology and hopefully you out there listening to us can sense that and hear that, when you listen to us talk about all these different topics.

Daniel Newman  02:23

Now, let me get the everyday stuff out of the way. This show is for information and entertainment purposes only and while we will be talking about a number of publicly traded companies and we even discuss the stocks earnings and performance of these companies. This show is in no way intended to be the providing of investment advice, do not see what Pat’s doing if you’re watching the video. Now that we’re doing this on video. Do not make any investment decisions because of anything we say here. However, the six five is all about six handpick topics, it’s deep analysis we try to keep it news light. We try not to tell you the stuff that everybody else is already telling you we try to tell you what it means. So that’s why you subscribe and become part of our six five family here is because, Pat and I try to go deeper, and hopefully we will do that today, Patrick. It’s getting a little better. It’s crazy, the world crazy, but I feel like you and I could be getting on an airplane. I was actually asked this by somebody today I don’t know you or you might have been by the same person may

Patrick Moorhead  03:31

I may have received that text too.

Daniel Newman  03:33

And they asked what date. What did you say what date Do you think you’ll be getting on an airplane going to an event.

Patrick Moorhead  03:40

I actually didn’t answer yet. I’ve been so busy that I haven’t gotten back to that person but can you can you get back to them and just tell them that pat agrees to.

Daniel Newman  03:51

Oh, all right on it I said October, I said October and I’m thinking it’s going to be a couple of very small analyst type gatherings I don’t think they’re going to be big events. But, but, but my friend I’m telling you. I’m going to put the mask on. I’m going to keep myself safe I’m going to keep everyone else safe. Getting back to life, though, getting back to life safely. I hope everybody out there is staying safe and staying within whatever level of comfort they have. We’re not here to tell you what to think. Pat and I, we like to, we like to opine, but we are certainly not here to tell you what you think. But I do hope, whether it’s vacations or work trips or just going in the office and spending time with friends and family that everybody does get to do that soon so stay safe out there now that that stuff is all out of the way, let’s talk about our six handpick topics today because we got a great show. I’m gonna jump into the first one,

Daniel Newman  04:45

Pat, Cisco late last week, announced that it was making an acquisition that’s just gonna make lots of acquisitions but this particular acquisition was a company called thousand eyes. Thousands eyes San Francisco based company. They’re an intelligence and internet and cloud intelligence platform, you know basically as business has moved into more cloud, and SaaS based work, the opportunity to simplify the management of all those applications has become more complex. So 1000 eyes is a technology that basically pairs very nicely with Cisco’s current network topology, I mean Cisco is a network company and if you had an on prem delivery of application services on your own network. There was a lot of tools and tech in the Cisco cupboard to manage that. When a big chunk of your, your work stream and tools, start to go into the cloud, start to become SAS delivered the intelligence and the ability to manage that becomes more complex. And so that’s really what the thousands eyes acquisition for Cisco was, was it was to expand Cisco’s capability for its current customer base that runs on Cisco’s network and Cisco is one of the largest network providers in the world to utilize its tools utilize it software and technology to better manage the quality of delivery of applications to both internal and external resources to me. It was really a no brainer now the number Pat came in at around a billion dollars we don’t know a lot about the company’s not a big publicly traded company, not a lot of data on customers. But the one thing I’ll say from an analyst standpoint is Cisco has been very fluid at making small but meaningful little acquisitions that enhance its portfolio. And this fits nicely into it’s the family with Meraki with App dynamics and now thousand dies as sort of being, you know this this network services software driven recurring revenue, which is an area that Cisco really needs to go in, so my early. My early analysis of the situation was it was a good move a sound move, and it’s great to see companies, you know, we’re going a little bit with Nvidia we’ve seen a lot of other new companies Intel, but it’s good to see tech continuing to make investments in acquisitions, even though we’re in sort of this strange period of time.

Patrick Moorhead  07:06

Yeah, it’s an interesting acquisition Daniel I appreciate it. The good analysis there. I want to take a little bit of a different tack on the acquisition. Not that it’s distinctly different from what you talked about it but it’s really more of a kind of a premonition here. So, this whole notion of multi cloud is really just a buzzword until you can figure out the security, and the networking and to go truly multi cloud, you have to know how applications are doing and what thousand, thousand eyes does right now is they essentially monitor and manage network and application performance and give really good visibility. And the only way you can really do multi cloud is, is to really understand how is an application running on a certain cloud, and to know when to shift it over to another cloud and that can be from on prem to public cloud, it can be from public cloud to public cloud it could potentially be public cloud or private cloud and. This to me is one puzzle piece, to be able to do that.

Daniel Newman  08:20

Yeah, I think I don’t think that was a debate I think you adding, it’s adding color man. That’s good stuff and you make a great point. We have a world that’s largely hybrid Our future is largely hybrid and hybrid isn’t just hybrid like one cloud and one on prem you’re talking multiple on prem multiple edge multiple clouds, and you have apps that are going to be delivered and experiences that will be delivered from each or any of those places, and the ability to have visibility to the quality that an app is delivered whether that’s you know how Netflix is being delivered on a user’s device, all the way to how your instance of SAP or Salesforce is working within your offices, more visibility is going to be important and because of the way architectures are being designed, having that tool that lets it leaders know how their businesses applications are performing to be very important so the premonition here is sound and I think that it’s a it’s a good one for Cisco we’ll have to see over the next few quarters how integration goes, how uptake goes we’ll be listening to future earnings calls to see how our customers are they adopting the technology has it been a winner for Cisco, but based on Cisco’s rich history as a networking company. It seems like a logical progression for for the organization pallets you go to the next one I had the chance to, to wrap for 10 minutes on Yahoo Finance last week about Dells earnings so you heard my take but you know what, because we like to mix it up on this show, why don’t you go first. Let’s hear your take.

Patrick Moorhead  09:51

Yeah, I love what Paul Gillen his headline in his article, it says What Recession, Dell VMware Vaporizes Wall Street earnings estimates and I loved it because not just because it’s over the top but it was actually true. I don’t think anybody expected Dell to come in and literally vaporize revenue and EPS, EPS estimates and it’s so funny how it’s so easy to be smart when you go back and you look at what the fundamentals were we’re in the middle of COVID, and they have a very large PC business, and a very well, and I might say, Well, technically it is one of the largest supply chains and tech on the planet, and in the good old days back when it was run by a Dell Dude, that was their thing. They had the best supply chain the deepest supply chain shrewd negotiators and they were able to deliver when other companies, weren’t we saw, HP earnings. Talk distinctly about the inability to get parts in there and PCs, were up. Not just because people get good parts but it’s things that end users actually needed the shelves were bare out there and the channel in the commercial channel and the consumer channel so wherever you could buy a PC, people were clamoring to get that infrastructure was down, but it wasn’t down nearly as much as everybody else, it was down around 9% if I compare it to a Cisco Cisco is down 15%. And if I look at HP. Their compute was down 20%. So, you know he was down but not nearly as down as everybody else. In fact, the only person that was up and infrastructure was IBM. They actually had growth, it was distinctly connected to the, the z15, and then to tack on to that you had VMware who is doing an incredible amount of security licensing to folks who had to deploy client computing outside of the enterprise and VDI and SDI solutions with things like VSAN. They really did did a great job so Dell literally vaporized their quarter, what’s your take Daniel.

Daniel Newman  12:26

Yeah. I think you hit on a lot of the key points, I think we knew the work from home thing was going to be a success. Yeah, and we’ll talk about HP earnings later. We knew that. Basically if a company had the ability to deliver PCs, there was a buyer for them. So we expected the enterprise or the commercial client business to be good and it was VMware was rock solid VMware was a rock solid part of the business. It’s been one of the best investments Michael Dell has made, and it will continue to be double digit growth in any environment and right now with what we talked about with Cisco the multi cloud space, and the familiarity of the VMware platform to CIOs around the world. Basically is providing the company. One of the most low hanging fruit in terms of moving their customers from VMware is virtualization technologies to VMware for for hybrid and multi cloud and you’re seeing that in the growth that doesn’t take away from the fact that companies continue to develop good products services licensing models and business. It’s just familiarity is important. The reason AWS has been so sticky and other cloud providers that have come out with new solutions I’ve struggled to win and I asked is because AWS built a dependable reliable platform that that their architects and network builders knew how to deploy. So, this is very similar with VMware people that knew how to use it, understand how to scale it and with things like Tom Zoo they’re doing this at scale and they’re becoming a really important part of this multi cloud story. So that’s where you’re seeing the growth from the other side of this, the whole thing the negative numbers market share is Dells thing market share, is what they’re looking for. And I believe in a couple of their key areas like servers, even though the TAM got smaller Dell still expects to take market share and that’s a really important thing to watch because we’ve been dealing with not just a quarter of COVID, but we’re actually dealing with multiple periods pat of pullback due to China and complexities and trade agreements so I’m looking at Dell and saying, you gotta you as the economy recovers and enterprise IT spend goes up assuming it will and I think we both believe it will Dells market share is sort of the number I’m paying a lot of attention to. So there’s the decreases in enterprise numbers are something to pay attention to and something investors need to think about, but I would actually say the fact that continued gains and market share and enterprise and key enterprise areas like server is an indicator that the company is still winning important battles and is in a good position coming forward so a good, a good quarter for Dell, a couple of very strong areas a couple of areas that should see improvement as economic conditions do get better, one last little point I know I’m going on a little bit here but I think is important is the, you know, there were a couple of pull backs and like benefits, 401 K’s. The company is getting a little more conservative it’s slowed down its payment of the AMC debt and actually took on some additional debt during this period of time, to provide liquidity, which I think is a good decision I think the 401 K is always hard because Dell is one of those companies that likes to be known for culture and when you take stuff away like that it’s never a great thing for building culture but. Jeff Clark was very forward that the anticipated time of returning all those benefits is the beginning of next year. And I think it was totally precautionary, the numbers did not really require it but if I was an employee at a company I would actually say I’m glad my company is taking steps to make sure that we’re not only here for the next six months, but we’re here for the next 20 years, and I think most of the indicators I got from the listening to the earnings call was the company is taking those types of steps so let’s go jump onto the third topic Patrick and let’s talk about another set of earnings but not really so much even about the earnings, a bigger story brewing in the work from home world of infrastructure was pure storage you know while again these inner enterprise companies with big infrastructure took hits. Pure Storage had a darn good quarter.

Patrick Moorhead  16:49

Yeah, they did, I had the chance to talk to, CEO Charlie Jean Carlo right after they posted. And we had a great conversation to get a little bit under under the numbers and what he what he talked a lot about was their movement to as a service, as we’ve talked about a lot on this show and you really wanted to, to point out and say hey Pat, you know, a check check this out so pure as a service is essentially a multi cloud consumption model that can go across all of the top clouds, and you can manage your storage as if it’s it’s on prem Does that sound familiar familiar. Absolutely and their numbers are just rocking I mean subscriptions are up 37%. Overall, and the second part is, is Daniel, you know, we, we looked at all the infrastructure players except for IBM, who had their revenue had gone down. Pure overall actually went up, 12%. so them and IBM were the only two infrastructure players to show growth. Now, IBM was a little lumpy and is a little lumpy you know they can be down 20% and up 20% because a lot of it is driven by the cycle of mainframes but pure just keeps cranking it out and part of the reason, by the way they, they’re not profitable. But their gross margins are 70% which means they’re spending an incredible amount of money on r&d, and they also spend a lot in marketing is is really the focus on and experience. I mean this company has satisfaction ratings that rival most smartphone makers and is absolutely incredible if you talk to a pure customer which I had the pleasure of doing when they had their conference here in Austin Texas of convention center. They talk about this stuff just works. It’s easy so I find it fascinating that that they’re one of the first on prem companies to truly deliver a cloud experience, and I think they’re, they’re being rewarded for it in terms of sales growth. And you know I know their detractors go after them because they’re not profitable but you know let’s not forget how long was Amazon unprofitable before it became the most valuable company on the planet what they keep doing is pouring more and more of their operating income into r&d and I love their model I mean they’re, they shake up an industry that has consolidated, a bunch. And they’re growing, and most others aren’t. Yeah,

Daniel Newman  19:58

you really caught my sentiment. I love the focus on experience. I think the lack in a lot of b2b businesses have real focus on things like C SAT scores like you know real customer satisfaction scores is is absent and a lot of businesses will tell you that in the experiences they have when they deal with it with companies so that’s a real differentiator I think another thing to point out is the real flexibility for a company like pure in a, in a cloud first work from home world, the disruption of its business was was negligible compared to companies providing big iron. And so yeah, you mentioned IBM earlier as the one company but like you said those cycles that those things were sold long before that core, you know that quarter ever took place with pure are the incremental business growth is much more favorable. And it actually links right nicely into the next company I want to touch on here, which is Salesforce, so you know another company. So yes, so I’ll just leave the pure thing with their business model is very good for what we’re going through in the world right now. And not only is the business model of the product good but the priorities of the business is good as well and that’s part of why the company is having success. But Salesforce reported to and, you know, pat i gotta say, with less travel and events, there’s been It feels like there’s been less announcement so hopefully these next coming shows we’ll have more like product launch and stuff to analyze and a lot of earnings and trust me I love going doing TV and doing media quotes for earnings, but it does feel like we’ve been a little earnings heavy lately. So just for everyone out there, bear with us, well as new tech starts launching again we’ll be, I promise you we’ll be talking about it but the company had a really good quarter year over year 30% growth for Salesforce yet again. The company did take a bit of a hit it was a little bit soft on guidance. You know, I was kind of going through this and I don’t think we have to spend a ton of time on it but what we just talked about at with pure is really the story behind Salesforce. So while yes there are industries contracting and there are industry struggling, but there were a couple of factors that I weighed in I talked to Business Insider about this Pat was that one is while Sales Cloud slowed down a little bit. The Service Cloud actually for the first time you served Sales Cloud revenue. This happened this quarter. Why is that interesting. Well, in the middle of a pandemic as companies were slowing down sales efforts collectively, the need to provide best in class service to customers became eminently more important, so customers up their investment in Service Cloud in a big way this last quarter. Also the fact that Salesforce is largely able to be consumed in cloud made it made the deployments and new purchases much easier for businesses to continue for so and again while there is a fraction of industries 10 20% of businesses that are in really bad shape. A lot of businesses were doing great companies were expanding quickly. You know, Amazon added six figures worth of of employees throughout the quarter, but not just Amazon a lot of big tech, a lot of big ecommerce businesses expanded very rapidly throughout this period and SaaS software was an option, a quick option for supplying support to these, these businesses, and it could be stood up without any touch and wouldn’t being able to stand something up in a cloud, without any touch is the beauty of SAS like we just talked about with pure, you know, going forward, there’s a little bit of softness the company does anticipate this may slow a little bit but still a very very strong year overall. And one of the leading indicators that I’m talking about watching is one of Salesforce has lesser watched businesses, but it’s their Marketing Cloud business, companies are dealing with all this data. Basically, these challenges that are going on in our global world right now. Companies are really have to figure out how to market to consumers again, and how to how to market in a post COVID world how to market, you know with all of this challenges in the global sphere. You know global economics us issues there got to figure how to get messages out and marketing will be something that needs investment and Salesforce has a significant Marketing Cloud that tends to be a smaller faction, I’m watching to see Pat if customers start spending money on marketing again, that’s kind of my take on Salesforce pat i know you don’t have a ton of time to look into this one but any anything hits your tickle your fancy.

Patrick Moorhead  24:46

Yeah, you know, I’m always keeping a track of how Tableau and mule soft are doing. And I really believe it or not, by the way i can be proven otherwise but I really see Salesforce, as a as an acquire to innovate company. I haven’t seen a whole lot of organic innovation, and I’m really interested to see what they do with the two companies that they acquired. And the second thing. Second reason I’m interested there is, is their operating model Tablo and mule soft are both hybrid companies and Salesforce, and you can, you know, hear Benioff talk about it all the time is he was a cloud web first and cloud only company. Well, well guess what we learned. Yeah, until it wasn’t. And, and those things are really difficult, you know as difficult as Microsoft. You know went from an on prem company to a cloud company I really think Salesforce is gonna have a hard time going hybrid because there are a lot of things you have to do that are different when you’re talking about a hybrid model you can’t you can’t drop a software update every 12 days in in on prem it just doesn’t work like that. You have to find a happy medium of of changes, there’s also a lot of data wrangling that needs to be done as well. And, and given by the lack of information out from the company on both tableau, and mule soft, you know have to have to jump to the conclusion and maybe they’re having some challenges.

Daniel Newman  26:31

Yeah, there wasn’t a lot of discussion of those two technologies, I think there’s some existing customer spend that’s probably there but I would have imagined if the growth was off the charts we would have heard about Yeah,

Patrick Moorhead  26:42

think about that $23 billion in acquisitions, but we’re going to we’re not going to talk about it. Yeah,

Daniel Newman  26:50

well I mean that’s what I said like at least with like Red Hat where we were, like, that was a lot of money, one of their big growth areas right now is Red Hat. But pat i mean i wrote on MarketWatch I basically eviscerated Salesforce after that acquisition because I think that was the moment, the company lost its way, even more so than with mule soft was making such a tremendously large investment in a company that did not fit its operating model what so ever. But you know what, Pat, are just gonna have to wait and see.

Patrick Moorhead  27:29

Benioff and Salesforce they went silent. Like, we’ve got this linear this line of companies we’ve written about who where they’ve helped their customers and communities with COVID-19. Where has Salesforce been. I mean, are they did they just decide to take a few months off and collect their pay, are they being silent because they just don’t want to talk about it and they think that aggrandizing helping customers is a bad thing I’ve never heard Benioff ever have a hard time talking about how great his company is, I don’t know.

Daniel Newman  28:03

Yeah, there was some of that Pat so we need to dig into it and again you and I spent so much time in so many HR teams that were very active and making sure that guys like us knew what was up. I don’t think we heard a lot from Salesforce but he did have his whole work, calm, which is basically this whole platform for returning safely to work and Benioff did get a lot of credit. I don’t know if it was deserved individually for making the whole. Let’s keep everyone employed for the next 90 days that was sort of benioff’s thing when COVID first became a big, but as a whole, you know when you talk about like Cisco doing a quarter billion dollars you talk about massive resources and compute and AI being delivered by other companies.

Patrick Moorhead  28:49

Amazon hired 175,000 people.

Daniel Newman  28:53

Yeah, it did seem like it was a little quiet when it’s usually so outspoken so yeah I definitely think that’s one of those things I think it’s gonna follow companies for a while the company’s ever quiet, you know that may end up coming back a little bit, so we’ll have to watch that pat that’s a it’s a good observation. So let’s talk about something that wasn’t earnings real quickly before we can talk about some earnings. But let’s talk about Qualcomm, and you know it’s a company we like to talk about let’s talk about something we don’t talk about with Qualcomm a lot and that’s Wi Fi this last week Qualcomm actually announced a couple of big launches in its new Wi Fi six, E, which was expanded, they expanded the six gigahertz spent spectrum a little bit, and the company came out with two new products, it came with a fast Connect product that essentially is going to be integrated into Snapdragon chips, two different series that can go up to 3.6 gigabytes per second, and allow basically phones multimodal to operate in between LAN and LAN to deliver super high speeds on our devices and you know I think of tons of applications for this. You’re in a stadium again someday soon I hope, and you’re with 65,000 screaming fans and you want to be able to order that nachos and a beer down to your seat that kind of technology that we’re heading towards or you want to be able to experience and augmented reality replay of your, have a great moment in a sporting event. It’s really hard to get great when inside a stadium or inside of a large mall or in a school throughout this whole process path throughout this whole work from home thing my Wi Fi has been my demise I mean I’ve got Wi Fi I’ve got mash I’ve got all this stuff you know what I ended up having to do it I ended up having to run cable by a managed Ethernet switch and make sure I was connected all the time because Wi Fi just isn’t good enough, a lot of the times and so this enhanced connectivity. And this new wider. You can call it highway, right you’ve just taken a one lane road into Austin and turn it into a three lane road. And by the way, Austin needs to expand its highway system, side note, anyway. And so that’s really positive and so on top of this fast Connect though path. The company also expanded its networking Pro Series because if you want to be able to use this, you actually need the chips in the in the in the routers, and so they built a whole series from home from home to stadium of routers and I think there’s like four different models for different environments, but I think this is a really interesting play building out this infrastructure that suddenly brings Qualcomm and its technology into every home on something other than us than a phone. And the fact is, is I do believe much like cloud, the future is hybrid I think when it comes to connectivity, the future is also hybrid. We’re not going to want to be dependent, all the time on narrowband 5g. You know, we’re gonna want sub six. We’re gonna want millimeter wave, sometimes we’re gonna need advanced LTE, and then a lot of cases, like I said, in our offices. We might even need 5g and Wi Fi six to work in or operably, where that Wi Fi is this if 5g comes into the building and then Wi Fi six distributes it so Qualcomm’s developing some really important products, but I think the reason I really wanted to point this out was it goes beyond the mobile device which is where so much of the energy goes for the company, but they, they’re doing a lot of interesting things in networking as well pat i know you’ve got away on on this one.

Patrick Moorhead  32:24

Yeah, I mean listen Daniel you, you give a very good analysis on what they’re doing and why it’s important I think what I want to do is bring in the competitive angle here which is Broadcom so before mesh Wi Fi came on the scene Qualcomm had almost no market share in in Wi Fi chips and in routers, and then they came onto the scene with mesh Wi Fi and did what I always knew could happen is they increased the ASP of a consumer router and and they did it with innovative companies like Google, as an example, and every mesh Wi Fi unit that you see in the channel right now is based on Qualcomm technology, their competitor Broadcom literally can’t figure it out. And what I see competitively for Qualcomm is the opportunity to start running up the score against Broadcom because this is an area of big strength for Broadcom, and you know, Daniel is, as you and I have researched for a long time Broadcom doesn’t like to invest money in research. Once the IP sitting there sure they’ll go take it and make a chip out of it but it’s typically they’re always going to be late to the party and, and this is this, I see this as the opportunity for. I don’t want to call it paybacks but you know after, you know, Qualcomm essentially stole 25 points of market share in Wi Fi from Broadcom i think that that maybe they want 50, or maybe they want 60 now.

Daniel Newman  34:12

Yeah, well, it’s a step in the right direction I mean you could see why Broadcom wanted to buy Qualcomm, there was a lot of benefits that would have come into the company, but I I was steadfast during that time I’m steadfast now it was not for the best for the Global Innovation pace of innovation for that acquisition to happen. And I’m glad that the decision was made to not allow that but personal feelings aside Pat, we got to keep moving on to our last topic here. HP Pat HP earnings I promised you earlier we talked about Dell and other provider of tech laptops and computers and 3d printing technologies reported their earnings as well. What was your take there.

Patrick Moorhead  34:52

Yes. So, this was another company that was poised to take advantage of the work from home phenomena I think the big challenge here was they had supply chain issues they just couldn’t get parts demand for PCs and ink was high the channel was clean. But it just couldn’t be fulfilled. So, in the context of COVID-19, and people working doing school and governing from home. They did well they just didn’t do as well as, as some of their competitors with larger supply chain, I am pleased to see that they do have a sizable notebook backlog that that their CEO, Enrique Loras told me on the phone would be fulfilled in q3 and is not going to be lost. They did say that that early May, their supply chain is fully online so at least half of their quarter won’t get get get hit. I was very, very happy and again this is a little bit less Industry analysts and more financial analysts, they did hit three Ps targets, even though they came up short on revenue, which I attribute to very successful cost containment indicating that it’s delivering on its cost containment plans. It had announced last year. So there we have it, Daniel short. Yeah,

Daniel Newman  36:22

that’s an interesting one Pat and I didn’t have a chance to monitor close so I heard a little bit of negativity that came out of the back end of that earnings and that was, was that related to the backlog, or sorry, not the backlog kind of the guidance being a little softer, now that it had its big work from home explosion.

Patrick Moorhead  36:38

Yeah, and it was the question on ink. A lot of the profitability that HP derives our profits from ink from companies, and with people, not going into work that high profit high revenue isn’t happening. Now on the flip side their consumer printing as a service skyrocketed right so people were who weren’t working at work and printing from work, were printing at home, they just didn’t print as much to make up make up for the downfall on enterprise printing.

Daniel Newman  37:15

Got it. Yeah, that makes a ton of sense so you know I think HP’s had a challenging run, but I think the company has, has a future. I’ve been really impressed with some of the progress that companies made some of its most recent notebooks I’ve been using a couple of their different products this year and I’ve used the Nv really liked it been been very satisfied I just mean the quality The, the manufacturing the look the feel of the brand has come a long way. I also think an area that the company has some real sizable opportunities has been an additive manufacturing and print 3d printing. Hadley stellar yeah has some really strong positions there. And, and the company needs to keep touting that we know Alex Cho who runs the personal computer business pretty well and rica who used to run the print business is now CEO of the company. I think that the company was able to deflect off Xeroxes overtures that would have been a real waste of a, of a merger, glad that didn’t happen. But it’s definitely gonna have to put its head down, find differentiation find scale find growth to become exciting again. That’s really the, I think that’s the, the story around all things HP and HP is past right now, but rooting for these historic companies to see the good things in the future patent was some great analysis.

Daniel Newman  38:41

So, With that, we were a little long-winded today but we do that sometimes don’t we, we should call it the six five and a half, because you know we just can’t seem to do five we’re like five minutes and 30 seconds per topic, plus our introduction or our introduction and we’d like to chat but hopefully everybody out there had fun with this show. We really appreciate the community we appreciate everybody that tunes in sticks with us week in and week out. If you like what you’re here, we ask that you hit that subscribe button we ask that you jump into Apple podcasts and give us a five star, give us a review share us out there in Twitter, or, you know, shoot us a note at six five podcast, talk to us. What do you want to hear about in tech that we could talk about all those things are in your control. We do read our Twitter’s, we do follow our social medias hit us on the, you know, hit us on those channels, but for now we gotta go. We’ll see you very soon on an episode of the six five podcast. Bye now.