By Ben Fox Rubin
Next week brings a small crop of equities reporting their latest
earnings, but that tiny group should pack a punch with a number of
major and notable companies, including FedEx Corp. (FDX), Oracle
Corp. (ORCL) and Darden Restaurants Inc. (DRI).
Also, the Federal Reserve will hold a policy meeting, and
inflight Wi-Fi provider Gogo Inc. should launch its IPO.
FedEx Earnings Expected
FedEx Corp. (FDX), which reports its fiscal fourth quarter on
Wednesday, is working on a multiyear restructuring plan in response
to the soft global economy. The Memphis, Tenn.-based company this
month opted to take a $100 million write-down charge for the
quarter to park old, inefficient aircrafts as it accelerates a
fleet modernization push as part of the restructuring, which
involves cost cuts and reorganizing its express, ground and freight
businesses.
The company, the world's largest international air shipping
company, is expected to post a 4% increase in revenue, though
per-share income should edge down 1%, according to analysts polled
by Thomson Reuters.
Cloudy Future for Oracle
Oracle Corp. (ORCL), which reports Thursday, has struggled to
transition into a provider of Web-based software, as it faces tough
competition in the growing field.
The company became a tech giant by selling on-premise enterprise
software to businesses and governments, but those products have
been losing demand as more customers buy software through cloud
services. Oracle has responded by aggressively expanding its Fusion
cloud-applications business and has grown its cloud business
through a string of acquisitions, However, it continues to fight
for market share against a range of smaller competitors that don't
have a legacy software business to support.
Analysts expect Oracle to post a 7% rise in per-share earnings
and a 2% increase in revenue.
Other software companies reporting next week are Adobe Systems
Inc. (ADBE) and Red Hat Inc. (RHT), which have also been making
their own pushes into cloud offerings.
More Earnings
Other companies reporting include market-research providers IHS
Inc. (IHS) and FactSet Research Systems Inc. (FDS), as well as
drugstore chain Rite Aid Corp. (RAD), Olive Garden and Red Lobster
owner Darden Restaurants Inc. (DRI) and La-Z-Boy Inc. (LZB).
Fed Meeting on Tap
For most investors, the two-day Federal Reserve policy meeting
is next week's main event. Policymakers have said future decisions
will be driven by decisions, and next week brings new readings on
factory activity, housing and inflation.
Two early looks at June factory activity are expected: Monday's
Empire State Manufacturing Survey and the Federal Reserve Bank of
Philadelphia's Business Outlook Survey on Thursday. Manufacturing
has been struggling of late, an impediment to the Fed's goal of
improving labor markets.
Kodak Looks for Approval in Bankruptcy Plan
Eastman Kodak Co. (EKDKQ) on Thursday will seek bankruptcy-court
approval of a deal to settle some $2.8 billion in claims asserted
by its U.K. pension plan.
Under the settlement, which Kodak calls "unprecedented," the
company would sell its personalized-imaging and document-imaging
businesses, which include cameras, retail photo-printing kiosks,
scanners, and other products and services to its U.K. pension plan,
which represents about 15,000 retirees. In return, the pension plan
will pay Kodak $650 million, $325 million of which is in cash.
Kodak said the deal is the centerpiece of a restructuring plan
that would see it exit Chapter 11 protection under the control of
its bondholders, whom it will ask to forgive the $375 million they
are owed in exchange for an 85% stake in the restructured
Kodak.
Gogo to Go Public
Gogo Inc., which powers inflight Internet service for a variety
of airlines, is expected to launch its initial public offering next
week, hoping to raise funds for working capital and other general
needs.
Other IPOs expected next week include biopharmaceutical firms
PTC Therapeutics Inc. and Regado Biosciences Inc.
--Jacqueline Palank, Peg Brickley and Kathleen Madigan
contributed to this story.
Write to Ben Fox Rubin at ben.rubin@dowjones.com
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