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Earnings Roundup

Preschool items help boost Hasbro

Hasbro sales rose this year without movie tie-ins after films based on its brands boosted revenue a year ago. Hasbro sales rose this year without movie tie-ins after films based on its brands boosted revenue a year ago. (Paul Sakuma/ Associated Press)
Globe Wire Services / October 19, 2010

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YESTERDAY
Close$46.81
Change+$1.73
52-WEEK
High$48.78
Low$26.82

Hasbro Inc., the world’s second-largest toymaker, rose the most since June in New York trading after its third-quarter profit gain surpassed analysts’ estimates, helped by sales of preschool products and games.

Hasbro advanced 3.8 percent after saying net income rose to $155.2 million, or $1.09 a share, in the quarter ended Sept. 26.

Analysts on average projected $1.04, according to a Bloomberg survey.

The toymaker’s sales climbed this year without movie tie-ins after films based on its Transformers and G.I. Joe brands boosted revenue a year ago.

A third “Transformers’’ movie will debut next year and films based on the Battleship, Monopoly, and Clue games are being developed as Hasbro bolsters its revenue from entertainment content.

Hasbro, of Pawtucket, R.I., expects a robust holiday shopping season, with inventories rising from last year so the toymaker can meet demand, chief executive Brian Goldner said.

The Hub, Hasbro’s joint venture children’s television network with Discovery Communications Inc., began broadcasting on Oct. 10 and has been well received by consumers, Goldner said. The network airs programming with shows based on Hasbro toy lines such as G.I. Joe and My Little Pony.

Citigroup income soars to $2.17b

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Citigroup Inc., the bank 12 percent-owned by US taxpayers, said that profit surged, beating analysts’ estimates as the company reduced loan-loss reserves by $1.99 billion.

Third-quarter net income was $2.17 billion, or 7 cents a share, compared with profit of $101 million, or a loss of 27 cents after preferred dividends, in the same period a year earlier, the New York-based bank said. Analysts surveyed by Bloomberg estimated per-share earnings of 5 cents at the bank, the third-biggest in the United States by assets.

The results bring chief executive Vikram Pandit one quarter closer to achieving his first annual profit after losses in 2008 and 2009 that totaled $29.3 billion. The reserve reduction showed how Citigroup benefited as fewer consumers fell behind on loan payments. Losses from bad loans declined to $7.66 billion from $11 billion.

Revenue fell 10 percent to $20.7 billion, while expenses declined 2.6 percent to $11.5 billion.

JPMorgan Chase, the second-biggest US bank, reported net income of $4.42 billion on Oct. 13 as provisions for loan losses fell $5.8 billion. Charlotte, N.C.-based Bank of America Corp., the nation’s largest bank, reports results today.

Citigroup’s trading and investment-banking unit posted net income of $1.38 billion, compared with $829 million in the same period last year.

Citi Holdings, the division created to hold businesses tagged for disposal, reported loan losses of $4.64 billion, down from $7.37 billion a year earlier.

Apple sales, profit beat estimates

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Apple Inc. reported fourth-quarter sales and profit that beat analysts’ estimates, citing demand for iPhones and iPad tablet computers for students heading back to school.

Net income rose to $4.31 billion, or $4.64 a share, compared with $2.53 billion, or $2.77, a year earlier, Apple said. Sales in the period that ended in September rose to $20.3 billion.

Analysts surveyed by Bloomberg had estimated sales of $18.9 billion and profit of $4.10 a share.

Analysts had predicted profit of $5.03 a share on sales of $22.3 billion for the current quarter. Apple typically gives forecasts that fall short of estimates.

Yesterday’s results include the first full quarter of sales for the fourth version of the iPhone, released in June, and the second time Apple has reported the performance of the iPad, now available in 26 countries. Apple sold 14.1 million iPhones. It sold 4.19 million iPads and 3.89 million Macintosh computers.

Increased demand pushes VMware up

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VMware Inc., the biggest maker of programs that let computers run multiple operating systems, reported third-quarter profit and sales that beat analysts’ estimates amid increased demand for its software.

Profit excluding some costs was 39 cents a share, topping the 35-cent average of projections compiled by Bloomberg. Sales rose to $714.2 million, the Palo Alto, Calif.-based company said. Analysts on average estimated $698 million.

As customers renew their enterprise agreements, VMware is persuading them to add new products and purchase more expensive versions of the company’s software, Sarah Friar, an analyst at Goldman Sachs Group Inc. in San Francisco, wrote in a note to clients.

Sales in the fourth quarter will be $790 million to $810 million, the company said.

That compares with the $773.8 million average estimate of analysts.

Net income more than doubled to $84.6 million, or 20 cents a share, from a year earlier.

VMware is majority-owned by EMC Corp. of Hopkinton.

IBM lifts forecast as income rises

YESTERDAY
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52-WEEK
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IBM Corp. said its net income rose 12 percent as it wrings more out of its services and software divisions and gets a lift from a new mainframe computer.

The Armonk, N.Y.-based technology company also raised its profit forecast slightly for the remainder of the year, demonstrating its skill at increasing profits faster than its businesses are growing.

IBM earned $3.59 billion, or $2.82 per share in the July to September period, compared to $3.21 billion, or $2.40 per share, in the same period last year.

Analysts on average expected $2.75 per share, according to a poll by Thomson Reuters.

Revenue rose 3 percent to $24.27 billion. Analysts expected $24.13 billion.

One potentially worrying sign for investors is that the value of the services contracts IBM signed during the quarter fell 7 percent, to $11.0 billion.

IBM is the world’s top technology-services supplier, and its long-term contracts provide a steady source of revenue even in bad times.

IBM’s new guidance calls for net income of at least $11.40 per share this year. The previous guidance was for at least $11.25 per share.

Investors have grown accustomed to IBM raising its guidance, but were expecting a smaller bump to $11.30 per share.