With earnings season in full swing last week, second-quarter results started pouring in, particularly from technology heavy-weights like Intel (INTC Quick QuoteINTC - Free Report) , Microsoft (MSFT Quick QuoteMSFT - Free Report) , eBay (EBAY Quick QuoteEBAY - Free Report) , IBM Corp (IBM Quick QuoteIBM - Free Report) as well as emerging new players like Netflix (NFLX Quick QuoteNFLX - Free Report) and Pandora . But there was also a historic deal with Japan’s Softbank picking up British semiconductor technology provider ARM Holdings thrown in.

Here are the top stories-

Earnings Highlights

Intel: Intel had a mixed quarter with revenue matching the Zacks Consensus Estimate and EPS exceeding. Intel appears to be beating the PC market weakness with its Client computing segment consistently outperforming the market. the main concern this quarter and the reason the shares lost some of their value was the weakness in the Data Center segment, particularly given ongoing competitive pressures here.

But Intel promised recovery in the second half of the year and also said they had built inventory of high end server chips last quarter. Other segments hummed along just fine. For further details, read: Intel Q2 Earnings Beat, Data Center Concern is Overblown

Microsoft: Leading software company Microsoft reported fourth-quarter earnings that beat the Zacks Consensus Estimate on revenues that missed. Investors took the news well, especially the strategy that continues to show the ongoing migration of its customer base to the cloud. The company appears on track to obtaining its 2018 target of $20 billion in annualized commercial cloud revenue. Management highlighted its many advantages in the cloud business and also named a number of important cloud customers, indicating its progress. For further details, read: Microsoft 4Q16 Earnings Show Strengthening Cloud Position

IBM: The company beat on both revenue and earnings, both of which were however down from the year-ago quarter. After 17 quarters of revenue declines, no one is really surprised about the top line performance, particularly since its refocusing efforts are well known.

The company still hasn’t managed to offset the declines in the core business with growth in others like cloud and data analytics. But it’s heartening to note that revenues from these new businesses grew 12% year over year to $8.3 billion with cloud revenues up 30% and business analytics up 5%. Mobile and security revenues increased about 43% and 18%, respectively. For further details, read: IBM Corp. Q2 Earnings Beat; Imperatives Gain Steam

Netflix: Netflix was another earnings beat on a revenue miss. But share prices plunged 13% as subscriber growth was below expectations. The company generates revenue through a subscription model, so subscriber growth is essential to sustain revenue and earnings growth, especially when increasing the cost of a subscription is easier said than done.

That said, with “grandfathering” of older subscribers coming to an end, the company did see some rate increases as well. Competition is increasing, particularly from Amazon (AMZN Quick QuoteAMZN - Free Report) , which now offers Prime Video on monthly trial basis as well. For further details, read: Netflix Tops Q2 Earnings, Falls on Subscriber Woes

eBay: The online marketplace matched the Zacks Consensus Estimate on earnings but beat on revenue. GMV minus FX impact was up from last year with both marketplace and StubHub contributing. International revenue was stronger than U.S. For further details, read: eBay's Q2 Earnings and Revenues Beat Estimates.

Pandora: The online radio company saw its loss narrowing more than expected on revenues that came in below the Zacks Consensus Estimate. Advertising, subscription and ticketing revenues all increased on a year-over-year basis, but advertising and ticketing were more significant. For further details, read: Pandora's Q2 Loss Lower than Expected, Cuts Sales View

SoftBank Buys ARM Holdings

Japanese conglomerate SoftBank has taken the bold move to acquire British semiconductor designer ARM Holdings in an all-cash deal valued at $32 billion. The Brexit vote may have made things easier for the Japanese company since the British pound is 30% cheaper for yen holders today versus last year. ARM has defied Brexit concerns to appreciate in value since the vote and SoftBank is paying a 43% premium.

SoftBank shares declined 10% however, so investors have reservations about its success. The concerns stem mainly from the company’s inability to deal with big acquisitions in the past, including of U.S. telecom company Sprint. But this time round, the company has captured a cash cow, which makes money from particularly every mobile device ever sold. It can raise the fees charged for licensing the technology and can use the cash to pay down its considerable $80 billion in debt. But ARM’s success has been great partly because of the reasonable licensing fees it charges, so there’s a something of a tightrope right there.

The acquisition furthers Masayoshi Son’s stated goal of targeting the IoT market across the world. The company now wishes to use ARM technology to facilitate the process. ARM has been acquiring companies to boost its own presence in IoT and SoftBank recently formed a JV with IoT technology and services company Aeris to expand its IoT network targeting various end markets including automotive in Japan, India, Europe and the U.S. SoftBank says it will double ARM’s UK headcount over the next five years and also increase headcount across the world. It will maintain the current business model.

This looks like real competition for Intel, but investors in the largest chip making company needn’t sweat just yet.

Amazon Prime in India

Amazon Prime has a lot to offer subscribers, whether it's deals, on-demand video or unlimited music streaming, or free two-day shipping. So its success in the U.S. is not surprising. But Amazon is not resting on its laurels. The company is expanding as fast as possible in high-growth markets like India. So its announcement earlier this year that it would launch in India for around 4K Indian rupees was no surprise.

It’s now taking that a step further by committing an additional $300 million (part of the $3 billion it said it would invest in June this year) to boost its video efforts in the region. The company has reportedly started acquiring necessary local talent and is in talks with Bollywood producers and independent production houses to create original content for its video streaming service Prime Video. While there is a market for Western-themed movies and TV shows, this is a very small part of the whole. Besides, it will be easier to offer locally produced content at locally acceptable prices.

But it may be too early to get excited about the plan because of some real challenges to execution that pre-exist. First, the subscription model hasn’t worked too good in the past. Local etailer Flipkart had limited success the first time round before re-launching with greater success later on. Second, this kind of offering requires significant advertising to create awareness, one thing that has also led to limited success of video service Netflix. And third, there are broadband connectivity issues that both the government and private companies are attempting to solve. But much work is left to be done.

Other stories you might have missed-

Corporate

First Apple Store in Taiwan: Going by job postings for personnel training and other positions for the “Apple Taiwan Store”, the company is looking to open its first store in the region. The Apple Store is more of a branding effort and a place for interaction with customers, than a necessary part of the retail process. The move comes at a time when Apple has reported significant declines in the Greater China/Taiwan/Hong Kong region, although the Taiwan part of those sales probably didn’t do as bad (Apple doesn’t break out revenue between these regions). 

Apple Is Top Brand Again: Following Google’s reorganization as Alphabet, the company dropped out of the top brands list. At least that is what a survey of 3K consumers and industry professionals about the world’s 100 largest companies by FutureBrand indicates. Alphabet is not as well known as Google, so only made the twenty-first position while Google didn’t qualify for the survey. Apple was followed by Microsoft, Samsung, Walt Disney, AbbVie, Facebook, Toyota, Amazon, Celgene and Gilead Sciences. 

Verizon Gets Yahoo:  Verizon and Yahoo have reached a $4.8 billion buyout deal for Yahoo's web assets; its patents are not part of the deal at this stage. For Yahoo, this would end a tumultuous three years during which time Marissa Mayer tried everything to bring the company back to life. After the tax-free spin-off of Alibaba (BABA Quick QuoteBABA - Free Report) fell through, activist investor actions would finally generate value to shareholders. For Verizon, it’s a question of acquiring Yahoo’s significant user base and some good digital assets that could help the company remain relevant in the digital age.  

Google Adds Cloud Data Centers: Brian Stevens, Google’s VP of cloud platforms told Fortune that Google’s recent data center addition in Dalles, Oregon is part of its push to adding ten new cloud data center facilities by 2017. Data centers offer lower latency (delays in response time to instructions) for customers when they are physically closer to them. The Dalles center will lower latency for some customers by 30-80%. Google is behind Amazon’s AWS and Microsoft’s Azure in this race with Amazon currently at 13 cloud regions with plans for four more and Microsoft at 26 cloud regions. All three provide infrastructure-as-a-service (IaaS), wherein companies can house their data and run their applications in computing infrastructure maintained by the providing company for usage-based charges thus lowering their computing costs.

Google A.I. for Cloud Customers: Google’s cloud infrastructure is finally coming of age. The company is now offering artificial intelligence (AI) to its cloud customers in the form of a couple of software programs to convert speech to text and draw meaning from text. This is in addition to translation and image recognition programs it offers also based on AI. Microsoft, Amazon and IBM already offer some form of AI to customers. Google has announced last week that AI (from its DeepMind acquisition in 2014) has enabled it to reduce electricity costs and improve its power usage efficiency (PUE) by 15%.

Google in Games: Small game developers (not companies or organizations with more than 15 members) now have the chance to get their creations in front of Tango and Cardboard VR users. Google is hosting a game fest on Sep 24 for which it will pick 30 such teams. There will be three winners, who will get Tango hardware, tickets to next year’s Google I/O and ad space in the Google Play Store. The company also has separate augmented reality (AR) hardware tech in the works. Endgadget says that the device will have more AR than VR features and will be able to operate independent of a phone or PC to power it.

Amazon Part of Italy’s Digital Turnaround: Amazon will invest 150 million euros to build its second major storage and logistics center outside Rome that will employ 1,200. The plan is to invest at least 500 million euros in the country as the Italian government doubles down on digitization therein. 

Groupon Upgraded: Piper Jaffray raised Groupon’s rating from Neutral to Overweight citing $150-200 million in increased advertising spend targeted at the U.S. market. The company expects this to add 3.5-4.5 million new active accounts through 2016 that will hold steady through 2017 adding $215-280 million in annualized gross profit.

Legal/Regulatory

France Data Collection Order: The French data protection authority National Data Protection Commission has issued a notice to Microsoft asking it to stop collecting unnecessary amounts of data from users without their consent. The authority has given Microsoft three months to comply with French data laws.

New Technology/Products

Facebook Acquila Takes to the Skies: Facebook has said that its solar-powered high-altitude Internet beaming plane had a successful test flight on June 28 in Arizona. The plane, which is designed to stay in the sky for three months reportedly stayed up 3X longer than expected. Facebook expects the plane to bring Internet connectivity to parts of Africa and other remote locations.

Twitter Works on Periscope Broadcasts: Twitter has introduced a number of enhancements to its periscope app: "Highlights" (to automatically create a short trailer of any Periscope webcast), Periscope web embeds within Tweets (to enable publishers to include rich media content from Periscope broadcasts in their online content, facilitating discovery and watching of live and replay content on the web), and a more immersive Watch Tab and Global Feed (a for autoplay of live broadcasts to instantly show viewers what's happening in the world).

M&A and Collaborations

Facebook NBA Deal: Facebook has acquired non-exclusive live streaming rights to all nine Olympic basketball exhibition games being played by the U.S. men’s and women’s basketball teams that are favorites to win gold. In case of glitches with Facebook’s system (which hasn’t worked so well on occasion), you can still catch the games on NBA TV.

Twitter, NBA Have New Deal: Twitter and the NBA expanded their relationship last week to include two new shows. The first is a weekly NBA pregame show for live-streaming on Twitter and the second (currently in development), is a program featuring behind-the-scenes videos, news conferences and other content for Twitter’s Vine and Periscope apps.

Moody’s Acquires Full Ownership of KIS: Moody’s Corp announced that it has acquired full ownership of Korean domestic credit ratings provider Korea Investors Service (KIS) with cash funds held overseas. The acquisition is not expected to have a material impact on the company’s earnings this year and is in furtherance of its longer-term strategic goals.

Some Numbers

Apple Watch Sales Fall in Q2: IDC has a report on smartwatch shipments in the second quarter. Accordingly, Apple with its Watch 2.0 remains in the lead with 47% market share (a decline of 55% from the year-ago quarter in which the device was first launched).

The other suppliers in the top five were Samsung with its Gear S2 lineup at 16% market share (51% increase in shipments), Lenovo with its Motorola devices including Moto 360 Sport at 9% (75% increase), LG Electronics 8% (26% increase) and Garmin with its focus on professional athletes making watches like Fenix 3 at 4% (25% increase). Other suppliers accounted for the remaining 16%, a 1% decline from last year.

Some Other Companies That Reported Last Week: Advanced Micro Devices, F5 Networks, VMware, EMC Corp and Moody’s.

Companies To Report This Week: Apple, Facebook, Texas Instruments, Amazon, Alphabet, Twitter, TripAdvisor, Garmin, Corning, CA Inc, Xilinx, Western Digital, NXP International, Nielsen, Linear Technology, Akamai, Fidelity, Groupon, GrubHub, Roper, Verisign, Automated Data Processing, Equifax, Lexmark

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>