September 16, 2019

Industry leaders participate in annual Deutsche Bank Technology Conference

The annual Deutsche Bank Technology Conference brought together the industry’s leading companies with some of today’s most noted investors. Held September 10 – 11 in Las Vegas, the conference offered a platform for tech companies to discuss developments, products and operational updates.

Nearly 80 companies ranging from industry pioneers to emerging businesses and newcomers including, Microsoft, Salesforce, HP, Texas Instruments, Fitbit, Match Group and Lyft, among others, showcased their offerings and strategies for investors.

Here are some of the conference highlights.

Microsoft

“In a nutshell, Microsoft delivered what we felt was a bullish message both about Azure as well as the environment, reaffirming the view that they’re not seeing discernible evidence of a demand slowdown and instead continue to pick up strong customer spending signals. Recent trend shifts include a growing mix of tier-one workloads as well as more large USD 500 million+ multi-year deals (AT&T, Chevron, Walmart, Walgreens). While Microsoft didn’t explicitly commit to 10%+ revenue growth in 2HF20 (the guide is for 10%+ growth in FY20), the bullish tone about the duration of the growth tailwinds leads us to believe that growth could remain double digit in 2HF20 even if it does moderate”. – Karl Keirstead, Senior Research Analyst

Lyft

“We thought Lyft sounded the best at the conference among internet presenters and reiterate our bullishness on Lyft. Lyft's tone was distinctly positive, highlighting that benign competitive trends continue and the company does not plan to resume aggressive couponing even if the US ridesharing incentive environment deteriorates. President and Co-Founder John Zimmer noted that the opportunity to improve driver utilization - a key driver we talked about in our recent coverage initiation that could add over USD 1 billion in improved unit economics over time - could be "more than a few percentage point" opportunity." – Lloyd Walmsley, Lead Analyst, Internet

Fitbit

“While still in its early days, Fitbit sees many opportunities in its subscription business, including a more stable recurring revenue stream and the opportunity to lower the barriers to entry for its hardware by bundling in a subscription offering. Fitbit's flexibility to work across both iOS and Android remains a key competitive advantage, especially as it begins to enter into more large partnerships with insurance providers, governments and corporations, where all the participants might not be iOS users. Fitbit continues to see strong opportunities internationally, where Android is the primary operating system. The company expects gross margins to improve in 2020 as some of its higher-margin businesses become a larger mix of company revenue and the drag from Versa Lite (fitness smartwatch) goes away.” – Jeffrey Rand, Research Analyst

HP

“HP appears to have multiple paths for EPS (earnings per share) growth y/y in FY20 despite guiding for the ever-important Supplies sub-segment to decline. While we did not receive clarity on a rank order of drivers to this guidance, we came away from our interaction more confident that HP will have multiple paths to FY20 EPS growth, including Personal Systems revenue growth, lessening dependence on Supplies for Print profitability, share repurchase, and COGS (cost of goods sold)/operating expense reductions. With HP’s Securities Analyst meeting on October 3, we expect to receive further clarity on HP’s long-term vision and a clearer idea of the path towards y/y EPS expansion.” – Jeriel Ong, Research Analyst

Texas Instruments

“We continue to view Texas Instruments as one of the best-in-class executors in the semiconductor space, and applaud the company for its structural and strategic positioning in both upturns and downturns. We believe the company is well positioned to continue its market dominance in the Analog and Embedded markets, with its focus in Auto and Industrial. However, we maintain our Hold rating as we believe this premium execution is already fully reflected in the company’s current valuation.” – Ross Seymore, Research Analyst