This quarterly financial round-up is a continuation of last week’s article when we reviewed Activision Blizzard, Alarm.com, CBS, Etsy and IAC. This week we’re featuring quarterly financial results from Apple, DISH Network, Onvia, SiriusXM and Tronc. Highlights among these companies include Apple’s net income of $8.7 billion and a $2 million donation in the wake of last week’s violence in Charlottesville, and SiriusXM’s subscriber base exceeding the 32 million mark.

Apple Reports 7 Percent Revenue Growth, Pledges $2 Million in Wake of Charlottesville Violence

Apple (NASDAQ: AAPL) reported quarterly revenue of $45.4 billion and quarterly earnings per diluted share of $1.67 for its fiscal 2017 third quarter ended July 1, 2017. For the same period in 2016, Apple reported revenue of $42.4 billion and earnings per diluted share of $1.42. Apple’s board of directors declared a cash dividend of $0.63 per share of common stock. Net income for the period was $8.7 billion, compared to $7.8 billion for the same period last year. By comparison, the company posted net income of $11.0 billion in the fiscal 2017 second quarter.

Other financial highlights for the quarter include:

• Revenue from services was $7.3 billion, or 29.4 percent of total revenue. Services revenue includes revenue from digital content and services, AppleCare, Apple Pay, licensing and other services. Services revenue was up 22 percent, year-over-year, says MacWorld UK.
• Gross margin of $17.5 billion, compared to $16.1 billion for the same period last year
• Operating expenses of $6.7 billion, compared to $6.0 billion for the same period last year
• Total assets at the end of the fiscal 2017 third quarter: $345.2 billion, compared to $321.7 billion for the same period last year

‘With revenue up 7 percent year-over-year, we’re happy to report our third consecutive quarter of accelerating growth and an all-time quarterly record for Services revenue,’ said Apple CEO Tim Cook. ‘We hosted an incredibly successful Worldwide Developers Conference in June, and we’re very excited about the advances in iOS, macOS, watchOS and tvOS coming this fall.’

Apple offered the following guidance for its fiscal 2017 fourth quarter:

• Revenue between $49 billion and $52 billion
• Gross margin between 37.5 percent and 38 percent
• Operating expenses between $6.7 billion and $6.8 billion
• Other income of $500 million

Apple stock has risen $7.81 since August 1, the date the earnings report was released, when stock closed at $150.05 per share. At 4:15 PM EDT yesterday, Apple stock was valued at $157.86. On August 18, 2016, Apple stock was valued at $109.08, so its value has increased by almost one-third.

Apple is more than a tech company. CEO Tim Cook tries to show the human side of Apple too. In the wake of the violence in Charlottesville, Cook pledged $1 million each to the Southern Poverty Law Center and the Anti-Defamation League, and said the company will match employee donations to human-rights organizations two-to-one through Sept. 30, said Recode.

‘We must not witness or permit such hate and bigotry in our country, and we must be unequivocal about it. This is not about the left or the right, conservative or liberal. It is about human decency and morality,’ Cook said in a note to employees, shared by Recode. ‘Regardless of your political views, we must all stand together on this one point – that we are all equal. As a company, through our actions, our products and our voice, we will always work to ensure that everyone is treated equally and with respect.’

Insider Take:

Whether you love Apple or hate it, Apple continues to grow at a steady pace while being a good corporate citizen. It continues to produce net income in the billion-dollar range, and it returns that value to shareholders, as evidenced by the growth in Apple stock value and the declaration of cash dividends. It looks like we’ll see more of the same in the fiscal 2017 fourth quarter.

DISH Network Reports Declines in Revenue and Net Income for Q2

On August 3, DISH Network Corp. (NASDAQ: DISH) announced its second quarter financials for the period ended June 30, 2017. In this most recent quarter, DISH had revenue of $3.64 billion, down from $3.86 billion for the same period last year. Subscriber-related revenue of $3.61 billion, was also down compared to $3.83 billion for the same period last year. In spite of lower revenue, DISH reported net income of $40 million, a sizable amount except when compared to last year’s net income of $424 million. DISH said net income was negatively impacted by litigation expenses of $280 million.

Other highlights for the quarter include:

• Diluted earnings per share of $0.09, compared to $0.91 per share for the same period last year.
• DISH activated 444,000 gross new pay-TV subscribers, compared to 527,000 for the same period last year.
• Net pay-TV subscribers for Q2 2017 were 196,000 compared to 281,000 for Q2 2016.
• At the end of the quarter, DISH had 13.332 million pay-TV subscribers, compared to 13.593 million for the same period last year.
• Pay-TV average revenue per user (ARPU) for Q2 2017 was $87.25 compared to $89.98 for Q2 2016.

In other recent DISH news, on August 7, DISH announced that it submitted a 200-page petition to the Federal Communications Commission (FCC) to deny the proposed acquisition of the Tribune Media Company by Sinclair Broadcasting Group, which DISH said ‘turn Sinclair into the nation’s largest broadcast conglomerate and lead to higher prices, more station blackouts, less choice, and less local news for millions of customers.’

On August 14, DISH announced that it was restructuring its leadership team for Sling TV, its over-the-top streaming video product, because current Sling TV CEO Roger Lynch is leaving to become CEO of Pandora. He will be replaced at Sling TV by DISH president and chief operating officer Erik Carlson.

‘Erik is positioned to fully support and grow our enterprise’s portfolio, including our Sling TV asset, as we work to connect 100 percent of the country through satellite, OTT, wireless and even digital over-the-air offerings,’ said Charlie Ergen, DISH Chairman and CEO. ‘Our company has built incredible assets from satellite, broadband, and streaming technologies, to a fleet of in-home experts and software development. We will continue to leverage those assets to be tuned in to the needs of our customers.’

DISH stock has taken a hit since the quarterly financials were released. On August 3, the day the financials were posted, DISH stock was valued at $61.11 per share. As of 6:44 PM EDT yesterday, DISH stock was valued at $56.94.

Insider Take:

DISH’s financial report did not include a lot of detail or guidance for the upcoming quarter. That information was likely included in the webcast which weren’t able to access online. Based on the numbers, we are curious what litigation DISH was involved in that cost so much, and why its revenue and subscribers have dropped year-over-year. With the streaming video market so hot right now, it is a bit surprising to see an OTT provider lose subscribers.

Onvia Subscription Revenue Up 6 Percent, Net Loss of $748,000 in Q2

Earlier this month B2G sales intelligence provider Onvia, Inc. (NASDAQ: ONVI) reported its second quarter financials for the period ended June 30, 2017. The company reported subscription revenue of $5.9 million, a 6 percent increase over the same period last year. Subscription revenue includes the revenue generated from inbound sales and the company’s self-service channel. Total revenue was $6.1 million, a 2 percent increase year-over-year. Despite these increases, the company recorded a net loss of $748,000, compared to a net loss of $125,000 for the same period last year.

Other highlights for the quarter included:

• Operating expenses were $6.2 million, a 15 percent increase over operating expenses of $5.4 million for Q2 2016.
• Annual contract value (ACV) was $23.1 million compared to $22.1 million last year.
• Total client count was 2,825, compared to 2,910 for the same period last year.
• Annual contract value per client was $8,164 compared to $7,590 for the same period last year.
• Dollar retention was 89 percent, compared to 86 percent for Q2 of 2016. Dollar retention measures how effectively the Client Success team has retained and grown existing subscription contracts.

In its second quarter announcement, Onvia said it would be focusing on two core initiatives for the balance of the year, including the development and launch of Onvia 8, the company’s new flagship platform. The mobile-friendly platform includes an improved user experience and adds workflow improvements like project sharing.

To move this project forward, the company moved its product development team from Indiana to Seattle. Part of the launch will include Onvia On Tour, a summer and fall tour that will unveil the Onvia 8 product.

The other initiative is to improve productivity of sales and marketing. Onvia said they reduced the size of the sales team and has reallocated resources to support the company’s marketing programs, including increasing the inbound demand generation support to prepare for the Onvia 8 launch. Part of that initiative included hiring Terri DePaoli as the VP of Sales.

‘We expect that these initiatives should begin to yield positive improvements by the end of 2017 and be evident in the financial results by Q1 2018,’ Onvi said in a press release.

Investors have not had a significant reaction to the financials. On August 3, the day the financials were released, Onvia stock was valued at $4.50 per share. At 4:00 PM EDT yesterday, stock was valued at $4.35 per share.

Insider Take:

As Doug Laney of the Gartner Blog Network explains, Onvia is one of a handful of companies that helps companies find government contracts to bid on. According to Laney, the federal government alone has contracted valued at $1 trillion a year. Add to that the $1.5 trillion in state and local government contracts available, and it has created a niche. By catering to both businesses and the government, Onvia helps both sides get the data and information they need to compete.

As one of only a few players, Onvia has seized an opportunity that is potentially worth billions. With a new flagship product, a tour to launch that product and redirected sales and marketing efforts, Onvia could see significantly higher revenue gains in the quarters to come, which could help it reverse its losses as well. This will be an interesting company to watch as it grows and evolves.

With Record Revenue of $1.3 Billion, SiriusXM Subscriber Base Exceeds 32 Million

On July 27, satellite radio provider SiriusXM (NASDAQ: SIRI) reported its second quarter financials with record revenue of $1.3 billion, a 9 percent increase over the same period last year. Net income per diluted common share was $0.043, a 22 percent increase over $0.035 in the second quarter of 2016. The company also reported net income of $202 million, a 16 percent increase, net self-pay subscribers of 466,000, and total subscribers of more than 32 million.

Other financial highlights included:

• Adjusted EBITDA of $522 million, a 12 percent increase over $468 million for the same period last year.
• Operating cash flow was $483 million, a 12 percent increase over $432 million for the same period last year.
• Free cash flow in Q2 217 was $417 million, a 6 percent increase over $395 million for Q2 2016.
• Subscribers grew by 5 percent with a 3 percent increase in average revenue per user (ARPU) which was $13.22, a record high for SiriusXM.
• Subscriber revenue accounted for $1.1 billion of total revenue, or 82.4 percent. Advertising revenue only comprised 3.0 percent. Equipment and other revenue made up the remainder of total revenue.
• SiriusXM pledged a $480 million ‘strategic cash investment’ in internet radio station Pandora.
• SiriusXM’s board approved a $0.01 per share cash dividend.

‘In the second quarter, SiriusXM continued its strong track record of execution, and demand for our premium content bundle pushed our listener base to an all-time high of more than 32 million paying subscribers. We are pleased to raise our full-year guidance for net self-pay subscriber additions, revenue, and adjusted EBITDA. We also made tremendous progress on strategic initiatives in the second quarter with the closing of our recapitalization of SiriusXM Canada, our acquisition of Automatic Labs, and our agreement to acquire a minority stake in Pandora Media,’ said Jim Meyer, CEO in a statement.

The company provided the following full year 2017 guidance:

• Self-pay net subscriber additions of approximately 1.4 million
• Revenue of approximately $5.375 billion
• Adjusted EBITDA of approximately $2.05 billion
• Free cash flow of approximately $1.5 billion

On Wednesday, SiriusXM announced the launch of two new channels: Turbo and PopRocks. Turbo, channel 41, will feature hard rock from the 1990s and early 2000s with music from artists including Linkin Park, Papa Roach, Korn Metallic, Nine Inch Nails and Disturbed. PopRocks, channel 17, will offer pop rock from the 1990s and 2000s to include Coldplay, Goo Goo Dolls, Train, No Doubt and Matchbox 20. Both channels will include music curated by the SiriusXM team. In other SiriusXM news, the satellite radio platform can now be streamed on devices with Amazon Alexa.

‘Our diverse lineup of commercial-free music channels continues to evolve to match the ever-changing tastes of our subscribers. We received tremendous feedback about our Turbo channel when it was available online and we are thrilled to introduce PopRocks to SiriusXM listeners across North America ,’ said Steve Blatter , Senior Vice President and General Manager, Music Programming, for SiriusXM.

SiriusXM’s stock price didn’t change much following the release of its Q2 financials. On the day the report was released, stock was valued at $5.83 per share. Yesterday, in after-hours trading, Sirius XM was valued at $5.48 per share.

Insider Take

Now with more than 32 million subscribers, SiriusXM continues to return solid financials, which is impressiver considering all of the entertainment options – including music and podcast options – available today. SiriusXM’s competitive advantages include exclusive content like Howard Stern’s show, expertly curated music, and unique programming options. The company’s investment in Pandora will also help the company enter the streaming audio space currently dominated by players like Spotify, Pandora and Apple Music.

Tronc’s Digital Subscribers Are Up 89 Percent, But Total Revenue is Down 8.6 Percent

Two weeks ago Tronc (NASDAQ: TRNC), formerly Tribune Publishing, reported its second quarter 2017 financials for the period ended June 25, 2017 with some interesting results. Tronc grew digital-only subscribers to 220,000, an 89 percent increase year-over-year, but total revenues of $369.8 million were down 8.6 percent year-over-year.

Other highlights for the quarter include:

• Advertising revenue was down 15 percent, year-over-year.
• Circulation revenue increased 2 percent, year-over-year with most of the growth due to an increase in digital-only subscribers and the Los Angeles Times.
• Total operating expenses were $351.3 million, down 10 percent, due to cost cutting measures.
• Net income was $6.8 million, or $0.21 per share, quite a bit higher than $4.1 million, or $0.12 per share, this time last year.
• Total second quarter 2017 average monthly unique visitors were 55 million, a 9 percent decrease year-over-year.
• Prior to the end of Q2, Tronc sold its ownership interest in CIPS Marketing Group.

‘Our solid bottom line performance during the quarter reflects our continued efforts to manage the business more efficiently,’ said Tronc CEO Justin Dearborn in a press release. ‘While we anticipate ongoing industry-level revenue challenges, we are optimistic about the company’s future and remain focused on continuing to execute our growth strategy.’

For the full year 2017, Tronc estimated total revenues would be between $1.54 billion and $1.56 billion with adjusted EBIDTA of $189 million to $195 million.

The value of Tronc’s stock has not changed significantly since the company reported its second quarter financials on August 2. On that date, stock was valued at $12.18 per share. At 4:53 PM EDT yesterday, Tronc stock was valued at $13.14 per share.

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Insider Take:

When broken out into segments, TroncM and TroncX, some of the declines are more pronounced. For example, for TroncX, total revenue was $58.2 million, a 5 percent decrease year-over-year. Advertising revenue was down 9 percent, while content revenues, including digital-only subscriptions and content syndication were up 14.3 percent. TroncM’s total revenues were down 9 percent and advertising revenue was down 17 percent, but operating expenses were also down.

What’s next for Tronc? Digiday reports that Tronc and Investor’s Business Daily are working on a paid monthly newsletter called Trophy Funds. IBD will create the content and Tronc will handle marketing and audience generation. A subscription will cost $7.99 a month with the publishers splitting the revenue. This is a somewhat odd partnership, but it could work as long as each partner is leveraging their strengths.