If you are looking for an answer to the question What is Artificial Intelligence? and you only have a minute, then here's the definition the Association for the Advancement of Artificial Intelligence offers on its home page: "the scientific understanding of the mechanisms underlying thought and intelligent behavior and their embodiment in machines."
However, if you are fortunate enough to have more than a minute, then please get ready to embark upon an exciting journey exploring AI (but beware, it could last a lifetime) …
Remark Holdings (MARK) is what one would call a contested company. It has long supporters with strong conviction, but there has also been some kind of a short drive, and the present short count is almost 16% of the nearly 25M float. That short count is far from the highest we've seen, a company like Applied Optoelectronics (AAOI) still has 78% of the float shorted (at least according to the latest figures) but it seems to have done major damage already. Who to believe, the conviction longs or the shorts who put out a troubling report. Questions like these are very difficult to solve, especially if you're not a forensic accountant. Since we're no forensic accountants ourselves, we'll try to gather some stylized facts and see what these add up to, and whether there is some chance for the longs to recoup some of their losses. This company was one of two highest conviction longs for SA contributor Yale Bock, who is the President of Y H & C Investments (see here).
Stitch Fix, a personal styling service powered by machine learning, delivered strong third quarter financial results on Thursday. The San Francisco-based company reported net income of $9.5 million, or nine cents per share, on revenue of $$316.7 million, an increase of 29 percent from a year ago. Wall Street was looking for earnings of just three cents per share on revenue of $306.4 million. Stitch Fix shares were up as much as six percent in after market trading. Elsewhere on the balance sheet, Stitch Fix said it had 2.7 million active clients, up 30 percent from the same time last year.
The business has been lucrative for the biggest player, InterActiveCorp and its listed subsidiary, Match Group, which owns Tinder, OkCupid and Match.com. That explains why shares of IAC and Match nose-dived 20% and 25%, respectively, when Mark Zuckerberg said Facebook would enter the dating scene. IAC and Match just offered a strong retort, posting first-quarter earnings that beat analysts' expectations. IAC, which owns 22% of Match and brands including ANGI Homeservices and Vimeo, reported revenue of $995 million, topping estimates for $922 million. Match Group, its largest subsidiary, grew 36% year-over-year to $407 million, notching the highest quarterly revenue growth since it went public in November 2015.
Match Group, which also owns dating apps OkCupid, Match.com and Plenty of Fish, reported a profit of $99.74 million for the quarter ended March 31, compared with a profit of $20.05 million a year earlier. Analysts had projected profit of $56 million, according to a survey by FactSet. Revenue increased to $407.37 million, from $298.76 million a year ago. Analysts had forecast $386 million in revenue. Revenue at Tinder increased more than 150% compared with a year ago.
Microsoft has reported strong Q3 results that beat analyst expectations, with revenues of $26.8 billion, up 16 percent year on year, or 13 percent in constant currency. Productivity and business processes revenues were up 14 percent at $9 billion; Office 365 commercial products and cloud services revenue grew 12 percent overall; Intelligent Cloud revenues hit $7.9 billion, up 15 percent year on year, while Azure revenues saw growth of 93 percent – having logged over over 90 percent growth for ten consecutive quarters. CEO Satya Nadella hailed the results, and suggested that AI, intelligence, edge computing, and the IoT stand at the core of the company's repositioning in recent years – which has taken place under his leadership. "It was another strong quarter, the result of picking the right secular trends," he said. "The intelligent cloud and the intelligent edge era is already upon us.
Google parent company Alphabet reported first quarter earnings for 2018 today, beating Wall Street estimates on sales and profit thanks in large part to its mammoth search advertising machine that continues to grow year after year. But one interesting highlight from the earnings announcement was just how much money the company's smart home company Nest earns in revenue and reports in losses. Because Nest was rolled back into Google proper earlier this year, Alphabet recast its quarterly earnings figures for 2017 to account for the fact that Nest revenues and losses would be moved from the "Other Bets" section of Alphabet's business to the standard Google revenue line item. Comparing the differences in quarterly revenues and operating income, we can see that Nest made about $726 million in revenue, yet it ultimately contributed a $621 million loss to the "Other Bets" section throughout the year. In other words, Google spent more than half a billion dollars last year to establish Nest in sectors like security cameras, alarm systems, and video doorbells.
Intuit said on Wednesday that strong sales of its tax-prep products should result in third quarter revenue growth of 12 to 13 percent in its consumer group, topping its previous guidance range of 7 to 9 percent. The personal and small business financial software maker saw sales of TurboTax Online climb six percent during tax season, while sales of TurboTax products overall rose four percent compared to the year-ago period. "We executed well this season and are excited that we are already seeing some of our investments pay off by accelerating our top line growth," said Michelle Clatterbuck, Intuit's chief financial officer. "As we've shared, this has been a year of increased investments in key areas including artificial intelligence and machine learning capabilities, Amazon Web Services migration, streamlined software development and enhanced brand and marketing effectiveness." Intuit's shares were up more than four percent Thursday morning.
Comcast continued to shed video customers in the first quarter, but is more than offsetting the slide with high-speed Internet and business services. In the first quarter, Comcast reported net income of $3.12 billion, or 66 cents a share, on revenue of $22.79 billion, up 10.7 percent from a year ago. Excluding items, Comcast reported earnings of 62 cents a share in the first quarter. Wall Street was expecting Comcast to report first quarter earnings of 59 cents a share on revenue of $22.75 billion. There are multiple moving parts in Comcast, but Comcast Business is growing the fastest.
The earnings growth was Alphabet's strongest since the fourth quarter of 2009. Advertising revenue, which accounts for nearly all of the company's top line, soared 24% to $26.6 billion. Revenue from "Other Bets," a segment which includes Waymo self-driving cars, totaled $150 million, an increase of 14% from the same period last year. The results landed while regulators in Washington are considering getting tougher on internet privacy. While most of the attention on the issue has focused on Facebook Inc., many observers believe Google's dominant role online means the firm will also be subject to tougher scrutiny.