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Yahoo Agrees To Verizon’s Discounted Acquisition Deal

February 23, 2017 by  
Filed under Around The Net

Verizon Communications Inc reconfirmed plans to acquire Yahoo Inc’s  core business for $4.48 billion, lowering its original offer by $350 million in the wake of two massive cyber attacks at the internet company.

The closing of the deal, which was first announced in July, had been delayed as the companies assessed the fallout from two data breaches that Yahoo disclosed last year. The No. 1 U.S. wireless carrier had been trying to persuade Yahoo to amend the terms of the agreement following the attacks.

Verizon and Yahoo signed the deal on Sunday evening after weeks of talks that included calls with Yahoo CEO Marissa Mayer and a meeting between Verizon CEO Lowell McAdam and Yahoo director Tom McInerney in New York earlier this month to agree on the amount of the price reduction, a person involved in the talks said.

The two sides had an agreement in principle about a week earlier that included a liability sharing agreement, something that Verizon decided early on that it needed to reach a deal.

Verizon conducted brand studies and found that Yahoo’s reputation was holding up after the hacks, the person said. The company decided to proceed in part because it continued to believe that the deal made strategic sense and that users were loyal and engaged.

The companies said on Tuesday they expect the deal to close in the second quarter. The data breach may delay some integration of Yahoo with Verizon after the closing, the person said.

The deal brings to Verizon Yahoo’s more than 1 billion users and a wealth of data it can use to offer more targeted advertising. Verizon will combine Yahoo’s advertising technology tools as well as its search, email and messenger assets with its AOL unit, purchased for $4.4 billion in 2015.

Verizon’s shares rose 0.3 percent to $49.33 in afternoon trading, while Yahoo’s shares were up 0.8 percent at $45.48.

Under the amended terms, Yahoo and Verizon will split cash liabilities related to some government investigations and third-party litigation related to the breaches.

Yahoo, however, will continue to be responsible for liabilities from shareholder lawsuits and SEC investigations.

Yahoo said in December that data from more than 1 billion user accounts was compromised in August 2013, making it the largest breach in history.

This followed the company’s disclosure in September that at least 500 million accounts were affected in another breach in 2014.

Toshiba Wants Nearly $9B For Memory Chip Business

February 22, 2017 by  
Filed under Around The Net

Japan’s Toshiba Corp wished to receive at least 1 trillion yen ($8.8 billion) by selling most of its flash memory chip business, seeking to create a buffer for any fresh financial problems, a source with direct knowledge of the matter said.

The beleaguered conglomerate was pressured to abandon an initial plan to sell just under 20 percent by its main creditor banks which are worried about potential writedowns that may come on top of $6.3 billion hit to its U.S. nuclear unit, financial sources also said.

Toshiba said last week it is now prepared to sell a majority stake or even all of its chip business, the world’s biggest NAND chip producer after Samsung Electronics Co Ltd, also rocked by the emergence of fresh problems at its Westinghouse unit that have delayed the release of earnings.

The company has not decided on the size of the stake to be sold, preferring to focus on the amount that can be raised but would like to retain a one-third holding as that would give it a degree of control over the business, the source with direct knowledge said.

Its willingness to relinquish so much of the unit underscores not only the depths of its financial woes but also resignation on the part of management to becoming a much smaller company.

The sale “is the best and the only way Toshiba can raise a large amount of funds and wipe out concerns about its credit risk,” said the source, adding that the sale should be completed by the end of March next year.

It wants to restart the sale process as soon as possible and may sell to multiple buyers rather than one bidder with interest already received from investment funds, other chipmakers and client companies, he also said.

A separate person with knowledge of the matter said Toshiba will outline terms of the sale by the end of February, conduct a first round of bids in March and aim to have chosen a preferred bidder or bidders by the end of May. The person also said Toshiba valued the chips business at around 1.5 trillion yen.

A Toshiba spokeswoman said the company cannot comment on the specifics of the sale process. Sources declined to be identified as they were not authorized to speak to the media.

Alibaba Goes Deeper Into Brick-and-mortar Retail

February 21, 2017 by  
Filed under Around The Net

China’s Alibaba Group Holding Ltd announced that it has  formed a strategic partnership with Bailian Group, the largest retailer by store numbers to join the e-commerce giant’s drive to use big data to improve and profit from brick-and-mortar sales.

The deal, which does not include any financial investment in Bailian, is the latest in Alibaba’s still nascent efforts to capture a bigger share of the retail market as online sales growth slows.

It has also spent $4.6 billion on a minority stake in appliances retailer Suning Commerce Group Co Ltd, is leading a $2.6 billion bid to take department store and shopping mall operator Intime Retail Group Co Ltd private and has bought a stake in grocery chain Sanjiang Shopping Club Co Ltd.

News of the agreement sent shares in Bailian Group firms surging but analysts cautioned it may take several years before returns from using big data can make a significant difference to earnings.

“There is a big push right now across brands to try and figure out how to mix physical and online shopping but gains so far have been limited,” said Shanghai-based retail analyst Ben Cavender at China Market Research Group.

The two firms will initially cooperate on supply chain technology using Alibaba’s big data capabilities and will integrate Alipay payments with Bailian Group’s existing membership program.

Bailian operates 4,700 outlets in 200 cities including supermarkets, convenience stores and pharmacies – more than double the stores owned by Suning, Intime and Sanjiang combined.

An Alibaba spokesman declined to comment on how many stores will be involved in the new partnership. A Bailian spokesman did not respond to a request for comment.

Alibaba, which has an active user base of around 500 million, has said it wants to tap China’s entire $4.8 trillion retail economy by developing data-driven management tools for retailers and brands.

China’s e-commerce market is expected to average around 18 percent annually until 2020, according to consultancy Bain & Company, compared with an average rate of 35 percent during the preceding four years.

And while e-commerce has seen phenomenal growth in China, brick-and-mortar sales still accounted for 84 percent of total retail sales in China last year, Bain said.

Among Bailian Group firms, shares in Shanghai Bailian Group Co Ltd were up by the 10 percent daily limit in afternoon trade. Lianhua Supermarket Holdings Co Ltd rose 7 percent and Shanghai Material Trading Co Ltd climbed 5 percent.

Snapchat Wants In On Hardware Development Too

February 21, 2017 by  
Filed under Around The Net

Snap Inc hit the roads of London on Monday promoting its initial public offering with a daring proposition: that it can build hot-selling hardware gadgets and ad-friendly software features fast enough to stay one step ahead of Facebook.

No longer just a purveyor of a smartphone app for disappearing messages, Snap has hired hundreds of hardware engineers, built a secretive product development lab and scoured the landscape for acquisitions as it pursues its newly stated ambition to be “a camera company.”

These efforts, which are aimed at developing hardware and so-called augmented reality technologies, are central to the strategy of a company that is seeking a valuation of up to $22 billion in its early March IPO despite heavy losses and the specter of stiff competition for advertising dollars with a far-larger Facebook.

It is a big gamble and the odds against Snap are long.

There is little precedent for a company with its roots in software and social networking succeeding in the notoriously difficult consumer hardware business. Few U.S. firms aside from Apple have made big profits on hardware, and camera and wearable gadget makers have much lower valuations than Snap is seeking. Once-hot camera start-up GoPro  is a cautionary tale: its stock sits 61 percent below its 2014 IPO price.

More broadly, creating new products and features that have mass-market appeal and cannot be readily mimicked is a huge challenge, analysts say.

“It’s worrisome,” said Paul Meeks, chief investment officer at Sloy, Dahl & Holst, which manages more than $1 billion in assets. “Snapchat is going to have to continue to be really innovative and distinctive. It’s going to be very tough to trump Facebook.”

Snap declined to comment for this story.

Snap first signaled its new focus with the September reveal of Spectacles, funky sunglasses with an embedded video camera for posting to the Snapchat app. The company spent $184 million on research and development last year, nearly half its revenue.

 

Verizon Reportedly Gets Discount On Yahoo Acquisition

February 17, 2017 by  
Filed under Around The Net

Verizon Communications Inc  is close to an updated deal to purchase Yahoo Inc’s core internet business for $250 million to $350 million less than the original agreed price of $4.83 billion, according to a source briefed on the matter.

Since last year, Verizon had been trying to persuade Yahoo to amend the terms of the acquisition agreement to reflect the economic damage from two cyber attacks. A source told Reuters that the deal, which could come as soon as this week, will entail Verizon and Yahoo sharing the liability from potential lawsuits related to the data breaches.

Another person familiar with the situation said the price cut was likely to be around $250 million, a figure that Bloomberg reported earlier on Wednesday.

A representative from Verizon declined to comment. Yahoo did not immediately respond to requests for comment.

“Maybe this isn’t quite as much of a discount as initially thought, but it’s at least something,” said Dave Heger, senior equity analyst at Edward Jones.

Verizon hopes to combine Yahoo’s search, email and messenger assets, as well as advertising technology tools, with its AOL unit, which Verizon bought in 2015 for $4.4 billion. Verizon has been looking to mobile video and advertising for new sources of revenue outside an oversaturated wireless market.

But Sunnyvale, California-based Yahoo has been under scrutiny by federal investigators and lawmakers since disclosing the largest known data breach in history in December, months after disclosing a separate hack.

The U.S. Securities and Exchange Commission has launched a probe into whether Yahoo should have disclosed the breaches, which occurred in 2013 and 2014, sooner, according to a report in the Wall Street Journal last month.

On Wednesday, Yahoo sent a warning to users whose accounts may have been accessed by intruders between 2015 and 2016, as part of a data security issue related to the breach it disclosed in December. A person familiar with the matter said notifications have gone out to a mostly final list of users.

Apple Finally Overtakes Samsung In Smartphones Sales

February 16, 2017 by  
Filed under Mobile

Apple has outpaced Samsung Electronics in smartphone sales for the first time in two years, but that victory might just be short-lived.

Samsung sold 76.8 million smartphones in the fourth quarter, giving it a market share of 17.8 percent, but it was just beaten by Apple, which sold 77 million iPhones for a 17.9 percent share, according to figures from market research firm Gartner.

The fourth quarter is usually a strong one for Apple, boosted by holiday sales of the new generation of iPhones it releases each September, said Anshul Gupta, a research director at Gartner.

For Samsung, though, 2016 ended particularly badly, dominated by the fiasco around the recall of its incendiary Galaxy Note7.

Super-phones like the Note7 could have accounted for 10 to 15 percent of Samsung’s smartphone sales in the period before its recall, said Gupta, but Samsung lost more than that: There was also the damage to its brand.

It could bounce back sooner rather than later, though, as it has a new flagship phone coming out at the end of March.

Apple, meanwhile, is expected to wait until September before unveiling new iPhones. This year will mark the iPhone’s 10th anniversary, and the next model is widely expected to be something special, so Apple fans may delay replacing phones until then, said Gupta. That would leave the way clear for Samsung to move back into the lead from this quarter.

That pattern showed up last year too: Although it dominated the fourth quarter, Apple was a distant second over the full year, with market share of just 14.4 percent over the year, far behind Samsung’s 20.5 percent, and the situation was similar the previous year.

 

 

Facebook Launches App For Smart TVs

February 16, 2017 by  
Filed under Consumer Electronics

Facebook Inc is launching an app for smart TVs that will aid the social network’s users in being able to view its videos on a larger screens.

The app will roll out soon from app stores for Apple TV, Samsung Smart TV and Amazon Fire TV, the company said in a blogpost on Tuesday.

The blogpost also said users can scroll through their news feed and simultaneously watch videos on their timeline.

 Sound also fades in and out as one scrolls through videos in news feed now. Videos in news feed have previously played silently — one needed to tap on a video to hear its sound.

The Wall Street Journal reported last month that Facebook was creating an app for TV set-top boxes that would bring the company closer to live video and video advertisements.

Facebook Chief Executive Mark Zuckerberg during a post-earnings call said this month that the company expected a major ramp-up in hiring and other spending during 2017 as it invests in video and other priorities.

The company last year expanded its live video product, Facebook Live – a potential threat to broadcast television.

T-Mobile Riding High, Adds Customers And Beats Revenue Forecast

February 15, 2017 by  
Filed under Mobile

T-Mobile US Inc, the No.3 U.S. wireless carrier, has reported higher-than-expected quarterly revenue and profit as its promotional offers aided in adding new customers.

T-Mobile had a number of promotional offers in the fourth quarter, including a free iPhone 7 offer with eligible trade-in around Black Friday.

Riding on the success of these offers, the company gained market share from rivals Verizon Communications Inc, AT&T Inc and Sprint Corp in an oversaturated U.S. wireless market.

T-Mobile said in January that it added 933,000 postpaid phone subscribers, or those who pay monthly bills, on a net basis, in the three months ended Dec. 31.

Chatter around a deal between T-Mobile and Sprint Corp resurfaced in December after Masayoshi Son, whose SoftBank Group Corp is a majority shareholder in Sprint, pledged a $50 billion investment in the United States.

Asked last week about a renewed merger bid with T-Mobile, Son said he was keeping his options open about Sprint.

T-Mobile’s total revenue jumped 23.4 percent to $10.18 billion.

The company’s net income rose to $390 million, or 45 cents per share, for the quarter from $297 million, or 34 cents per share, a year earlier.

Analysts on average were expecting a profit of 30 cents per share and revenue of $9.84 billion for the quarter, according to Thomson Reuters I/B/E/S.

 

iPhone 7 Plus Features Pays Off For Apple

February 10, 2017 by  
Filed under Mobile

Features exclusive to the iPhone 7 Plus aided sales of the larger smartphone, but they were not the only reasons why a higher percentage of customers went big last year, analysts said.

“The nature of the market is also shifting,” said Ben Bajarin of Creative Strategies, in a recent interview. As consumers encounter large-screen smartphones with more frequency — especially ones owned by friends — there’s a bandwagon effect, he explained.

Although the shift to bigger screens has been strongest in China and other Asian markets, the iPhone 7 Plus accounted for a larger proportion of new iPhones sold in the U.S. as well, said Bajarin, citing his firm’s research.

Apple does not separate iPhone sales by market, or even say exactly what percentage of total sales was of the 7 Plus, but CEO Tim Cook did claim that the number was the highest yet for its 5.5-in. model. “We saw especially strong demand for iPhone 7 Plus, which was a higher portion of the new product mix than we’ve ever seen with Plus models in the past,” Cook said during the December quarter’s earning call on Jan. 31.

Even before Apple disclosed iPhone sales — for the December quarter, the Cupertino, Calif. company booked 78.3 million — analysts expected that the average selling price, or ASP, would be up over the same period the year before, in part because of the widespread belief that the iPhone 7 Plus had done better than its 2015 and 2014 forerunners.

That was, in fact, the case: The December quarter’s iPhone ASP was $694.57, a record.

Some credited the iPhone 7 Plus’s performance to the features Apple offered only in the large-screen model, notably Portrait Mode. Bajarin agreed that Plus-only features could be selling points. But they were no guarantee. Those specific to the iPhone 6 Plus and 6S Plus, for example, weren’t enough to make those models as successful as the 7 Plus.

More telling than differences between iPhone models, he said, was the consumer perception of the total package. “The evidence we see from China is that when something [is seen to be] the pinnacle at that moment, that’s when China moves toward that product,” Bajarin said. “So there is some value in keeping interesting and expensive technology as a differentiator.”

Among the features that the supply chain rumor mill has posited for this year’s iPhone, several might appear only in the most expensive model, such as a curved OLED (organic light-emitting diode) display and wireless charging.

Not every analyst concurred with the concept of burnishing the Plus model with extra features if that came at the expense of the smaller-sized models.

“It’s more important that Apple makes [each new generation of the] iPhone durable and powerful,” said Ezra Gottheil, an analyst with Technology Business Research. “That’s recognizing the reality of the market, and justifying what is an increasing price delta.”

Did Apple Really Have A Banner Quarter?

February 8, 2017 by  
Filed under Around The Net

Apple may have spun its results last week so that the Tame Apple Press thought that it had done much better than was expected.

When Apple published its results, we were surprised as we expected the company to be in a somewhat poorer state due to slumping iPhone 7 and Tablet sales.

Imagine our surprise when Apple announced that it made record profits. After all we knew that Apple had actually contracted its supply of its iPhone’s twice and tablets were a mess – how was it possible to be making even more money? The Tame Apple Press reported that everything was alright and Jobs Mob was back seemingly without coming up with a new product.

We were not the only people who smelt a rat. Jason Snell and the Under pass also thought there was something wrong and delved into the figures. Before the lawyers complain that we are calling Apple liars there is no proof that lied, it just failed to point out that the Tame Apple Press was wrong.

Most Apple fiscal quarters are 13 weeks long. Occasionally, however, they have a 14-week quarter. Apple’s Q1 2017 was a 14-week quarter, for the first time since Q1 2013. This means that Jobs Mob could add in the results of an extra week’s profit.

Snell said that even a rubbish week would add enough to counting stats to push it well above the year-over-year quarter, which was 13 weeks long. In fact, if you knock off a week from the results Apple’s sales and profits fell exactly like we expected.

He said it was possible to make the numbers tell the story you want to tell, with charts to match, and slice it nine different ways.

Part of the issue which the Tame Apple Press failed to spot was that Jobs’ Mob finances were based on its financial statements—and that means the quarters as Apple defines it. In this case Apple, has defined an extra week of sales that it won’t get again for another few years.

To make matters worse it was a windfall week that next year’s year-over-year holiday-quarter comparison will not be able to match.

But that was not the only thing Apple did. A huge settlement benefit hit the first quarter of FY16, which makes Services look even better (but doesn’t change the overall net) so everything is artificially inflated.

So where are the analysts pointing out that Apple might not be the investment that people claim? When this happened in 2013, the Tame Apple Press did exactly the same thing and Philip Elmer-DeWitt wrote a brilliant headline “Apple analysts: Stupid or lazy?” This time they did the same thing and few people have batted an eye lid.

Courtesy-Fud

Snap Agrees To Pay Google $400M Annually For Cloud Services

February 7, 2017 by  
Filed under Around The Net

Over the next five years, the firm that owns Snapchat will pay Google at least $2 billion in cloud bills.

Snap has revealed in a filing with the US Securities and Exchange Commission that it signed a five-year contract to pay Google at least $400 million a year for cloud services. That’s a steep figure, considering that Snap made roughly $404 million last year.

In return for the massive commitment, Snap will receive reduced pricing, though it’s not clear how deep the company’s discounts will be. Sinking a bunch of money into Google Cloud makes sense, because Snapchat began its life built on top of Google’s AppEngine platform-as-a-service offering.

Furthermore, Snap’s commitment to Google is a massive vote of confidence in the latter’s cloud capabilities, at a time when there’s heavy competition in the cloud market.

Right now, Google’s cloud is an underdog compared to Microsoft and Amazon. But being tied to a rising star in the social media landscape like Snapchat could help draw other companies to at least give Google’s platform a chance.

However, the contract is not without risk. If Snap doesn’t use $400 million worth of Google Cloud services in a year, it’s still on the hook for the full value of the contract. What’s more, the company said in the filing that it uses Google for the “vast majority” of its “computing, storage, bandwidth, and other services.” If something goes wrong with Google Cloud, or if the tech titan gets out of the public cloud business, it could be bad news for Snap.

That last scenario seems highly unlikely, considering that Google continues increasing its investment in its cloud platform. Urs Hölzle, Google’s vice president of technical infrastructure, said last year that the company plans to launch new cloud data centers at the rate of roughly one each month this year.

All of this is tied to Snap’s plans to pursue an initial public offering in the near future. The filing released on Thursday is one of the company’s steps along that path. Snap’s IPO is being closely observed by the tech industry because of the company’s high-flying status.

It remains to be seen how Wall Street will receive the company, especially since it’s far from profitable and its losses have widened year over year. Plus, the deal with Google means that Snap will be saddled with hundreds of millions of dollars in liabilities for the foreseeable future.

Google Unloads Satellite Imaging Business

February 6, 2017 by  
Filed under Around The Net

Alphabet Inc’s Google has announced intentions to sell its satellite imaging business, Terra Bella, to Planet Labs, a San Francisco-based private satellite operator founded by former NASA scientists.

The financial terms of the deal were not disclosed.

As part of the deal, Planet Labs will acquire the Terra Bella business including the SkySat constellation of satellites, Alphabet said.

Google will enter into a multi-year contract to purchase Earth-imaging data from Planet Labs after the deal closes.

Google had acquired Terra Bella, originally known as Skybox Imaging, for $500 million in 2014.

The deal will help Planet Labs broaden its available data and add new customers.

Planet Labs is one of several startups aiming to harness technology allowing satellites to become smaller and less expensive, making it easier to deploy large networks of satellites at less risk and lower cost than previously.

Fitbit Struggles Continues, Announces Layoffs

February 2, 2017 by  
Filed under Consumer Electronics

Fitbit has revealed that it will institute cost measures and layoff of 6% of its global workforce after experiencing softer-than-expected holiday demand for fitness trackers.

The company and analysts said despite the negative news, there is still a future market for wearable devices as well as for smartwatches made by Apple, Samsung and, soon, Fitbit itself.

In its preliminary financial results for the fourth quarter of 2016, Fitbit said it sold 6.5 million devices, with revenues expected to reach up to $580 million, down from previous guidance of $750 million.

“We are confident this performance is not reflective of the value of our brand, market-leading platform and the company’s long-term potential,” said co-founder and CEO James Park, in a statement.

“We believe the evolving wearables market continues to present growth opportunities for us that we will capitalize on by investing in our core product offerings, while expanding in the smartwatch category to diversify revenue and capture share of the over-$10 billion global smartwatch market,” he added.

Park said consumers want a “stylish, well-designed” smartwatch that has “general purpose functionality with a focus on health and fitness.” Fitbit recently acquired Pebble, Vector Watch and Coin (with its mobile payments technology) to “position the company for long-term success.”

Park and co-founder and Chief Technology Officer Eric Friedman said they will reduce their 2017 salaries to $1. The layoffs will affect about 110 workers, while expenses will be reduced by about $200 million to about $850 million in 2017. The reorganization will affect sales and marketing groups and create “optimization” of the company’s research and development efforts.

Jitesh Ubrani, an analyst at IDC, said he didn’t think Fitbit’s fourth-quarter results signaled a long-term decline for wearables and smartwatches.

“I don’t think the entire category is in trouble just yet,” he said in an email. “Fitbit is indicative of the larger trend that growth will be slower. This is more of a pause than a continued decline.”

Fitness devices in general have been a “commodity, and a lot of initial excitement has subsided,” Ubrani said. Apple Watches and Android Wear devices have been successful in finding specific niches for sports and fashion, “but none have had mass appeal.”

Is Apple Losing In Some Aspects Of The Hardware Space?

January 31, 2017 by  
Filed under Around The Net

Apple has really dropped the ball when it comes to hardware and is rapidly losing ground to rivals.

Jobs’ Mob’s Mac sales dropped roughly 10 per cent amid a declining market which fell 5.7 per cent for the year. But Apple’s rivals seem to have benefited from Apple’s failure. Bloomberg analysts Anand Srinivasan and Wei Mok noted that Apple’s rivals grew.
Dell saw the most growth at just over 10 per cent.

Apple was pushed to number by with ASUS overtaking it. The top four vendors are now Lenovo, HP, Dell, and ASUS.

These four make up 65.2 per cent of the overall market and each grew year- over-year. All this happened while Apple lost ground by declining to 7.1 per cent. The other 27.7% of the market is comprised of more than 200 vendors.

Bloomberg predicts that the market will consolidate. Samsung and Fujitsu are reported to be in discussions to sell their PC businesses to Lenovo.

Apple has even been losing ground to Microsoft which has been pouching customers so that they switch from the Surface clone that Apple created to the much better real thing.

Srinivasan and Mok suggest that Apple needs to find new markets with their high priced computers to continue growth. They might find an easy mark with the growing middle class in China but they are still in the high price-range relative to other PCs. While
American buyers are that dumb enough to fall for Apple’s marketing, the Chinese are a little more cost conscious. Any Chinese buyer looking at the spec will be aware that they are paying too much for the logo on the clam shell.

Apple needs its US and developed countries in Europe, to improve. These represent 63 per cent of its market and are where people have more money than sense.

Courtesy-Fud

Microsoft Passes The $500B Market Capitalization Mark Again

January 30, 2017 by  
Filed under Around The Net

Microsoft Corp’s (MSFT.O) market capitalization surpassed $500 billion for the first time since 2000 last week, after the technology giant’s stock rose following another quarter of results that beat Wall Street’s expectations.

Shares of the world’s biggest software company rose as much as 2.1 percent to $65.64, an all-time high, in early trading last Friday, valuing the company at $510.37 billion.

The last time Microsoft was valued more was in March 2000, during the heyday of the dotcom era, when it had a market value of a little above $550 billion, according to Thomson Reuters data.

Despite the gains, Microsoft still lags Apple Inc’s market capitalization of about $642 billion and Google-parent Alphabet Inc’s market value of a little more than $570 billion.

Microsoft reported second-quarter results on Thursday that beat analysts’ average estimate for both revenue and profit, mainly due to its fast-growing cloud computing business.

The company’s profit and revenue have now topped Wall Street’s expectations in seven of the last eight quarters.

Chief Executive Satya Nadella has been trying to reinvigorate Microsoft since taking over the lumbering giant nearly three years ago, and has helped build more credibility around the company’s efforts in areas such as cloud-based services.

When he took the top job in February 2014, the company’s stock was trading at around $34 and its market value was roughly $315 billion, according to Thomson Reuters data.

“The pieces are falling into place as we are starting to see an important shift in the model, with improving profitability in growth segments,” RBC Capital Markets analysts wrote in a note.

At least 11 brokerages raised their price targets on the stock, boosting the median price target to $68.50 from $68.00.

Of the 37 analysts covering the stock, 27 rate it “buy” or higher, eight have a “hold” rating and two “strong sell”.

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