Twitter  has seen a good recovery in its stock price over the past few months, up from a dip below $30. However, the price is still extremely volatile as the company undergoes numerous changes. The company announced significant changes to its management team and is also focused on driving up revenues from newer sources. These two factors might drive up Twitter's fortunes in the future. 

Management shuffle
The social media company has recently gone through a number of changes to its leadership team, which might be a positive for the company's strategy in the future. Twitter's COO Ali Rowghani resigned from his role, however, he will continue to be a strategic advisor to the CEO. The COO's responsibilities will be assumed by others in the company's ranks. 

In addition, Twitter hired a senior TMT investment banker from Goldman Sachs, Anthony Noto, to be its CFO last week. And Twitter's old CFO Mike Gupta will be moving into a new position called Head of Strategic Investments. The Old CFO will likely be leading Twitter's future strategic investments in the related social media and technology verticals space. And also having a leading banker as a CFO will be very beneficial for Twitter due to the relationships that person will be able to bring to the table. 

And as a result, Twitter is a lot more likely to go on a small-scale acquisition spree just like Facebook did in 2014 so far. Facebook continues to dive into newer arenas as the company acquired video ads technology company, Live Rail recently. And Twitter is likely to go on such a hunt with after its big shuffle in its management ranks. 

Future drivers
Besides the big overhauls in its management line-up, the company can grow revenues from at least two other sources -- by increasing ad loads on its platform and by growing its mobile advertising network, MoPub. Investors are however, concerned about the growth of the company's user base and engagement. 

Twitter's monetization of its own platform can see a significant boost in the future because the company's ad load is a lot lower relative to its peer Facebook. In other words, Twitter can increase the number of ads it shows on its micro-blogging site substantially without negatively impacting the experience of users. And as a result, Twitter's average revenue per user (ARPU) has the potential to rise to much higher levels.

In the last quarter, Twitter's ARPU stood at just shy of $1 per user. On the other hand, Facebook's ARPU in Q1 2014 stood at $2 per user, in spite of having a significantly larger customer base compared to Twitter. So with growth in ad loads on its platform, Twitter can potentially reach Facebook's quarterly ARPU level of $2 per user, without having to reach 1 billion plus users like Facebook. Twitter can come up with more ad products geared toward media and entertainment on its platform because of the real-time and conversational nature of Twitter. 

In addition, Twitter can significantly grow its revenues and earnings off-platform through MoPub. The mobile ad exchange is already one of the largest in-app ad exchange, and considering the growth of mobile devices and app development worldwide, MoPub has a significant runway of growth ahead. Just recently, MoPub signed a $230 million two year deal with ad agency Omnicom. 

As a result, there is sustained business momentum for Twitter, and it can continue its robust revenue growth without significant growth in consumer adoption. However, analysts and investors alike tend to be focused on evaluating Twitter's future prospects on user growth and engagement levels. 

Going forward
Twitter is still being used extensively around the world, and its newer revenue drivers can make meaningful contributions to the company's revenue growth trajectory. Twitter made a number of user interface changes to its site and that can be pre-cursor for sustained user engagement in the long-run.

Twitter's management laid out revenue projections for Q2 2014 to be in the range of $270 million-$280 million. And that implies a year-over-year revenue growth rate of more than 100%. And with the help of other monetization drivers like MoPub, Twitter can possibly sustain its high growth rate story for a few more years, and in the process make the company a lot more valuable. 

GoPro shares were clearly underpriced at its IPO based on the stock's 30%-plus return since its public market debut. Yet, for investors still wanting in, there are likely two reasons to avoid the stock, which oddly involve the likes of Twitter and Sony .

Is 45% a blessing or a curse for GoPro?
Whoever said that the video camera industry was dead didn't consider GoPro. The company has figured out a way to catapult the space by marketing to those who wish to share their daily activities via picture or recording in point-of-view frames. Due to its rising popularity, the company's U.S. market share of the camcorder market rose from 11% to 45% over the last two years, according to NPD Group.

This market share translated into revenue of $966 million over the last 12 months and top-line growth of 87% from 2012 to 2013. However, with this growth and market share comes competitive pressure, or companies that may not have taken the camcorder space seriously in recent years.

Specifically, Mashable reported late last year that Sony was preparing to compete head-on against GoPro with its new Action Cam. Sony's new device captures a 170-degree field of view with various screenshots and dual-screen options that have made GoPro's hardware beloved.

Source: Mashable

Albeit, the camcorder market is not make or break for Sony, as the diverse media and technology company has more than $75 billion in 12-month revenue. However, the company's size also gives it a distinct marketing and research and development advantage, with more resources available.

With that said, GoPro did note in its S-1 filing that many of its competitors are larger with more resources, which could cause a loss in market share. Undoubtedly, this is a concern investors must consider, and at 80 times last year's earnings, the market does not seem to be pricing in this risk for GoPro.

Could initial demand soon become excess supply?
Despite the likelihood of increased competition, let's say you're sold on GoPro's competitive edge and its chances to gain even more market share in the years ahead. Therefore, you may want to initiate a long-term position.

The problem for investing in momentum IPOs is a pesky little event called a lockup expiration, where insiders and other original investors are able to sell their shares in the open market. While trying to time the market can be problematic, buying before these lockup expirations has also proven to be unwise with recent momentum IPOs.

Take Twitter for instance, a company with very few similarities to GoPro with the exception of momentum following its IPO. Back in early May, Twitter shares lost nearly 20% of their valuation over a two-day span, adding to much larger losses in the months prior. Since then shares have recovered to trade higher by 30%.

Twitter data by YCharts

The reasons for these losses were expectations and the reality of a large and looming lockup expiration. Specifically, nearly 85% of Twitter's total shares outstanding, that weren't offered in its IPO, became eligible to sell during the expiration.

While shares of Twitter have since recovered, the overhang of the expiration did weigh on shares and affected the stock in the day proceeding and on the actual session of the expiration. For GoPro, it offered just 17.8 million of 123 million shares outstanding in its IPO. Therefore, 180 days following its IPO, standard for expirations, more than 85% of its total shares may hit the market. On that day we'll see if GoPro shares have better luck than Twitter's stock.

Foolish thoughts
Two serious risks facing potential GoPro shareholders are increased competition and the large number of shares that may still enter the market. As for the former, this includes large companies like Sony and is especially dangerous due to GoPro's enormous market share.

For the latter, a lockup expiration isn't just a one-day event but rather a signal that insiders and institutional investors can then sell at any point, meaning the stock's initial demand could soon become excess supply. Combined, these are two major reasons to avoid GoPro for the time being, or to at least be patient before buying the stock. 

Thanks to Japanese Prime Minister Shinzo Abe's policies aimed at reviving growth in the economy, popularly known as "Abenomics," Japanese equity prices soared to record levels las year.

However, 2014 has been anything but remarkable for the Japanese equity markets. The major Japanese stock indexes have faced huge sell-offs and extreme volatility in light of low economic growth and deflationary concerns, coupled with global macroeconomic developments such as the tapering of quantitative easing by the U.S. Federal Reserve.

Will the third arrow score a bull's-eye?
That said, the party is by no means over for the land of the rising sun. Recently, as reported by CNBC, Prime Minister Abe announced a slew of policy measures aimed at reviving growth in the economy, popularly know as the "third arrow" of the PM's policies.

Measures that should encourage investors include the reduction of the corporate tax rate to less than 30% and deregulation of the country's highly restricted agricultural industry. Such market-friendly policies should not only enhance the profit margins and return on equity of Japanese companies, but could also give a significant boost to the stock markets, making a bullish case for Japanese stocks going forward.

The best choice to capitalize on this trend
For an investor seeking exposure to Japanese stocks, my recommendation would be the WisdomTree Japan Hedged Equity ETF . The ETF tracks the WisdomTree Japan Hedged Equity Index, an index designed to measure the performance of 328 Japanese stocks listed in the Japanese markets. This fund employs a unique strategy.

When you're invested in a foreign market, you are primarily exposed to two types of risks: 1) risk that your investments will lose value and 2) risk that your domestic currency will strengthen in relation to the currency of the foreign economy. You may lose money in both cases.

However, the Japan Hedged Equity ETF hedges the currency risk associated with investing in Japanese stocks denominated in the Japanese yen by utilizing currency forward contracts -- derivative instruments that are used to manage currency risk. With these contracts, the ETF locks in a particular rate for the U.S. dollar versus the yen. So even if the yen were to lose value against the dollar, investors' returns would be safe, as the forward contracts have already defined an exchange rate for the two currencies. This means you're essentially left with the pure equity returns without the adulteration of currency fluctuations.

The strategy works best when the yen actually looses value versus the greenbacks. If the opposite happens -- i.e., the yen strengthens against the U.S. dollar -- investors will be deprived of the additional currency returns. However, given the present scenario, the latter seems less probable, primarily because the "third arrow" of Abenomics, coupled with monetary tightening measures in the U.S., will likely lead the yen to weaken against the greenback, which is why I believe this strategy employed by the ETF will prove fruitful for U.S. investors.

Currency impacts matter
The chart below shows the comparative performance of the WisdomTree Japan Hedged Equity ETF and two other ETFs tracking Japanese stocks: the iShares MSCI Japan ETF  and the First Trust Japan AlphaDEX ETF . These two ETFs track almost the same stocks as the currency-hedged ETF, but they do not employ the currency-hedge methodology.

In order to showcase the impact of currency on overall returns, I'll show the period from December 2012 to May 2013, when the first round of monetary easing was introduced.

DXJ data by YCharts.

Not surprisingly, the currency-hedged ETF crushed its non-hedged counterparts, as the yen's devaluation was factored into the total returns of the non-hedged ETFs but hedged out of the currency-hedged ETF.

The WisdomTree ETF charges an expense ratio of 0.48% and has managed to amass a huge asset base of $10.7 billion. Its top holdings by weight include Toyota Motor Corp (5.2%), Mitsubishi Finance Corp (5%), Japan Tobacco Inc (4.1%), and Canon Inc (3.4%).

Long-term outlook
In light of the above facts and research, it is probable that the Japanese equity markets are in for the same kind of investor reaction they experienced when Abenomics 1.0 was implemented. However, investors should also realize that it will take time to implement these policies and realize their full potential.

In any case, given the possibility of positive economic developments, the bullish case for Japanese equities, and the impending devaluation of the Japanese yen, happy times surely seem to be in store for the currency-hedged ETF.

Stocks gave up more ground on Tuesday, as the Dow and S&P 500 continued their retreat from all-time record highs last week. Yet even after two straight days of declines, the market remains close enough to its record levels that dozens of stocks are still setting new yearly highs. Some of the most noteworthy stocks setting new highs for the year today were Freeport-McMoRan Copper & Gold , Colgate-Palmolive , and LG Display .

Source: Freeport-McMoRan.

Freeport-McMoRan only gained 0.2%, but that was enough to send the mining and energy company to its best levels since late 2012. Freeport-McMoRan announced early today that it had agreed on a draft memorandum of understanding with the Indonesian government, with hopes that the agreement will lead to the company being able to resume export of copper concentrate from the south Asian nation. For months, Freeport has had to deal with tight export rules that forced it to stop exporting concentrate from Indonesia. But reports suggest that in exchange for Freeport agreeing to finance construction of new smelter facilities within Indonesia as well as paying higher royalties and selling off a 30% stake in its Indonesian operations, the government will agree to lower export taxes that would allow Freeport to start moving materials out of the country again. Nevertheless, with a presidential election tomorrow and with the likelihood of political change following the results, it could take months before a final deal actually takes effect.

Source: Colgate-Palmolive.

Colgate-Palmolive climbed almost 1% to a new all-time record high for the consumer-products company. Colgate has managed to score strong growth in earnings and sales and expects to see that upward trajectory continue throughout the year. With its control of almost half of the global toothpaste market, Colgate-Palmolive can count on stability in its financial performance, and on a down day for the stock market, that kind of safety holds even greater appeal. Colgate also has plenty of growth opportunities, especially in emerging markets, and that could provide the impetus for further share-price gains in the future.

LG Display rose almost 3%. LG Electronics, which has about a 38% minority stake in LG Display, has gotten a lot of attention for its G Watch smartwatch product, with a major U.S. telecom company announcing that it would sell the new $299 smartwatch and start taking pre-orders today. With LG Display also hoping to help make components for rival smartwatches from Apple and other manufacturers, the big question is whether the new wearable technology will capture early adopters with lasting impact. For now, the future looks bright for wearable mobile devices, and LG Display appears well-positioned to benefit.

There are several ways to measure the strength of the housing market in the United States. One is to look at macroeconomic figures such as new home sales and existing home sales. These numbers often provide information about the bigger picture. Another way is to look at the earnings of companies that are active in the housing market, most notably homebuilders. Lennar Corporation , one of the biggest homebuilders in the U.S., recently came out with its quarterly earnings report and had some interesting things to say about the market. In this article, we'll take a look at the macro figures, as well as earnings from Lennar and competitor KB Home .

May housing numbers
The May home sales report was encouraging and allayed some fears of a significant slowdown after a few less-than-stellar monthly reports. Last month saw the highest rate of existing home sales in nearly three years with purchases rising 4.9% to an annualized rate of 4.89 million.

Perhaps more importantly for homebuilders, new home sales rose to a six-year high, up 18.6% to an adjusted annual sales rate of 504,000. At the same time, the increase in house prices slowed, which indicates that the recovery may be entering a more mature stage.

The slump in the housing market earlier this year now seems to have ended, according to some analysts, amid a steady improvement in jobs numbers and lower mortgage rates. The average rate on a 30-year, fixed-rate mortgage has declined to 4.17%, from 4.41% at the beginning of April. Sentiment among homebuilders is also improving, and the market appears to be rebounding from a weather-related low earlier this year, with residential construction expected to pick up this quarter.

Solid earnings
While Lennar's earnings were more or less flat year over year, its earnings per share of $0.61 soundly beat the $0.51 consensus estimate. Revenue shot up 27% to hit $1.82 billion, which also easily topped the $1.68 billion consensus. Deliveries were up 12%, and the average sales price of these homes rose by 14%. Lennar's management, which seemed to back the view that the housing market is steadily improving, had the following to say:

While the spring selling season was softer than anticipated by us and the investor community, the homebuilding recovery continued its progression at a slow and steady pace. The fundamentals of the homebuilding industry remain strong driven by high affordability levels, favorable monthly payment comparisons to rentals and overall supply shortages.

Other homebuilders also seem to be doing well. KB Home reported earnings before the bell on Friday which had investors fairly pleased. Revenue rose by 8% to $565 million, largely driven by a 10% increase in average selling price as the company delivered fewer homes than it did last year. Operating income soared to $34.3 million from $8.7 million a year ago. EPS of $0.27 per diluted share easily beat the $0.20 consensus and was up from a loss of $0.04 in the prior year.

The results from these two homebuilders seem to back the most recent macro figures in this instance. This suggests that the housing recovery remains intact, although it has slowed down to a steadier and perhaps more sustainable pace.

The bottom line
In the last few months, investors have been worried about the state of the US housing market because the macro figures weren't particularly encouraging. However, these fears may now prove to have been exaggerated, as housing seems to be coming out of a weather-related slump that occurred earlier in the year partially because of better affordability and an improving employment picture. Earnings from homebuilders such as Lennar and KB Home seem to confirm that the recovery remains ongoing, albeit at a somewhat slower pace.

As you might have heard, the French economy is not in its best shape. As a matter of fact, it is showing signs of contraction. According to the most recent flash Purchasing Managers' Index report, or PMI, released by Markit, France is showing weaknesses in the both the manufacturing and the services sectors. The composite PMI for the country fell to 48 from 49.3 in May. Unfortunately, a figure below 50 means contraction. In addition, the report shows that output in the country is down for the second successive month, orders are falling slightly, and staffing levels suffered their sharpest cut in four months -- not so encouraging.

However, two French ADRs are enjoying a strong momentum. One is Criteo , a technology company specialized in digital performance advertising. Let's check them out!

Outstanding results
The first quarter of 2014 saw record figures for Criteo. Revenue increased 60.8% year over year to $207.5 million, and the company's total number of clients grew 46% year over year to 5,567. Now Criteo holds new and promising accounts with a high amount of traffic, such as Visa and Rent.com.

After three years of development, Criteo just rolled out significant technical enhancements to its proprietary prediction and recommendation engine. Basically, this new technology enables Criteo to decide whether to buy each ad impression based on the probability that a user will both click on the ad and make a purchase on the advertiser's site. Now clients will be able to expand their reach to a greater number of potential buyers without paying more per sale. In fact, this breakthrough has brought a 38% sales increase while maintaining the same cost per of sale.

Technically speaking, predicting whether an ad impression will generate a click and a sale is not an easy task, as that happens about once out of every 10,000 impressions. But this new improvement will not only improve the accuracy of Criteo's predictions but also help customers maximize the reach and effectiveness of their marketing campaigns.

Criteo's global reach is second only to Google Display Network's. According to comScore, Criteo is reaching nearly 1 billion unique Internet users per month. The company manages to reach a large and growing group of Internet users whom other major marketing channels don't. In fact, nearly 50% of Internet users worldwide who saw a Criteo ad were not exposed to Google search ads.

Criteo's new engine improvement is set to greatly expand the company's business. It brings pure benefits at the same cost for clients, so it should attract more new clients to the company.

Another intriguing ADR
If Criteo is not enough, there's another French company positioned to grow: Veolia Environnement SA , which is the world's largest environmental-management services company, having a presence in 48 countries. The strong business case for Veolia is pure demographics. The world will need more clean water in the future -- there's no way around it. In fact, according to the World Health Organization, demand is expected to exceed supply by 40% by 2030. Most of it is related to the lack of access to freshwater sources and irrigation mechanisms. Government and NGO investments to revert this situation are likely to push demand for Veolia's services going forward.

Veolia already provides about 100 million people with drinking water and brings sanitation solutions to 71 million people while also managing 60 million metric tons of waste every year. The company's extensive knowledge and international presence should help it get more service contracts going forward; the growing demand is out there already. Almost half of Veolia's total turnover of $30.4 billion is generated outside France. Plus, these types of contracts last at least a few years and hold a high chance of being renewed. 

Price-wise, Veolia's stock has soared 60% over the past year, yet it's not even close to its all-time high. Currently, Veolia is priced at around $18, but in late 2010 it reached prices near $40.

VE data by YCharts.

Veolia is a solid and stable business to bet on for the long-term. The company's competitive position and the growing demand for clean water are on our side.

Final foolish takeout
France is giving us a few signs that the country's economy is losing dynamism. However, these two French ADRs look promising going forward. Both are well-positioned within their markets, and their businesses are not significantly exposed to France.

Broadcom has the dominant share of the connectivity combo chip market, but as the growth in the smartphone market has shifted away from the high end and toward the low end and the mid-range, Broadcom has lost ground to chief competitor Qualcomm . Qualcomm's big advantage is that it can sell the entire platform while Broadcom is trying to sell standalone connectivity chips. How can Broadcom fend off Qualcomm?

Defending the high end
Broadcom's objective in the mobile and wireless space will principally be to defend its share at the high end of the market. This means keeping its design wins in Apple's iPhone and iPad products, as well as in Samsung's flagship Galaxy products, since these are the really high-volume runners at the high end.

The strategy to "win" here is simple to state but of course requires solid execution -- Broadcom needs to continue to stay a step or two ahead technologically. While Broadcom is certainly ahead today, it would be unwise to discount Qualcomm's ability to push forward and try to close the gap. The best case is that Broadcom stays perpetually ahead, keeping margins intact, but a more likely scenario is that Broadcom can stay marginally ahead and may need to concede on margins slightly.

The low end to mid-range is trickier
At the very low end, Broadcom is likely to see its share suffer, as the apps processor vendor almost always provides the connectivity solution as well. Though Broadcom does provide the connectivity solution to platform vendors that don't have their own connectivity (think Spreadtrum or NVIDIA), those companies have lost -- and will probably continue to lose -- share in the low end and mid-range of the mobile space

Broadcom has signaled that the revenue that is at risk here is on the order of $500 million to $800 million, so conservative investors may want to assume that most -- if not all -- of this business goes away in the long run, though the attrition could be stretched out over many years.

What does this mean for Qualcomm?
This is generally a good trend for Qualcomm. Qualcomm has the widest portfolio of cellular products and has been gaining share nicely, so the opportunity for incremental connectivity content is robust. The primary risk that Qualcomm needs to deal with is the aggressiveness from MediaTek, has its own in-house cellular and connectivity solutions, at the very low end of the market.

The good news for Qualcomm, though, is that even its very lowest end Snapdragon processors tend to feature similar -- if not identical -- modems to what Qualcomm sells in its very highest end products. This means that even though MediaTek has access to comparable CPU and GPU IP as does Qualcomm, Qualcomm can differentiate with a better modem. If Qualcomm can do this, the connectivity sale is almost assured.

Foolish bottom line
Broadcom's connectivity business is in a bit of a tight spot. Without cellular, the lower end of the market becomes tougher to hang on to, and at the high end, there is risk of share loss if Qualcomm is able to catch up. That said, it is worth noting that even as Qualcomm has advanced its connectivity offerings, Broadcom has continued to hold on to its very sizable share of the high end -- speaking to the durability of Broadcom's competitive position here.

Earnings season kicks off today on Wall Street, and with the stock market near historic highs and the job market in a state of strong recovery, strong corporate earnings can only serve to corroborate the bullish images we're seeing painted about the economy. With so much riding on quarterly earnings, stocks took a dive on Tuesday. TripAdvisor , First Solar , and Salesforce.com ended as the three worst stocks in the entire S&P 500 Index today. The S&P, for its part, lost 13 points, or 0.7%, to end at 1,963.

Online travel booking company TripAdvisor saw shares tumble 5.6% today as investors moved away from high-flying momentum names, favoring more conservative, yield-bearing assets instead. And while TripAdvisor's growth prospects look promising, the stock is neither cheap -- with a pricetag of 70 times earnings -- nor yield-bearing. Online travel companies have been some of the hottest in the markets in recent years, and TripAdvisor's earned its position as one of the elite, growing annual revenue from $352 million in 2009 to $944 million in 2013.

First Solar, on the other hand, doesn't have the sky-high valuation of TripAdvisor. But it does operate in a nascent and unpredictable industry with no established history, making it far from a sure bet, even at 15 times earnings. First Solar stock lost 4.9% today, not because of any company-specific news, but because the emerging and highly competitive business of solar panel manufacturing didn't suit investors' risk tolerance today. Heavily subsidized Chinese rivals like Yingli Green Energy and others add international hurdles for First Solar as well.

Salesforce's "Sales Cloud." Image Source: Salesforce

Lastly, cloud enterprise provider Salesforce.com lost 4.3% on Tuesday. Salesforce has grown revenue at an exceptional and consistent pace for the last four years, with sales posting annual gains between 26% and 36% a year consistently throughout that time period. The company's bottom-line performance, however, has been less spectacular, and the company has lost a combined $500 million in its last two fiscal years. Those losses haven't stopped Salesforce from stating its international expansion efforts, however, and it recently announced its intention to expand its operations in Germany specifically. Salesforce is also expanding its service offerings to increasingly include business analytics, an area of potentially exciting growth prospects with the preponderance of big data.

Intel   is by and large still a PC company -- the giant chipmaker derived 62% of its revenue from the PC market in the first quarter of fiscal 2014. However, the company has been slowly lowering its dependence on this declining market. Its PC-related revenue in 2012 stood at 65% of its total. Intel has a strong presence in the server microprocessor market too, where its Atom microprocessors have helped it dominate the rapidly growing embedded systems market.

The company's huge success in manufacturing PC microprocessors has, unfortunately, not extended into the smartphone and tablet markets, where Qualcomm and Samsung dominate. The mobile and communication segment currently accounts for less than 3% of Intel's overall revenue. This failure has been partly to blame for Intel's slow top-line growth in recent times.

Source:IDC Press Releases, Gartner

Intel has, however, been making significant strides in the smartphone and tablet market that will not only help the company become an important mobile player, but also help accelerate its top-line growth. Let's have a look at some of these:

New chips to spur new growth
Intel's mobile and communications revenue fell 22% from $1.8 billion to $1.4 billion between 2012 and 2013. In the first quarter of fiscal 2014, Intel realized revenue of just $156 million from this segment, 61% less than its figure for the comparable quarter in 2013. This drastic decline has been orchestrated by the falls in feature phones and 2G/3G and the transition to LTE solutions.

LTE is showing the strongest growth among the various mobile technologies that dominate today's market. Nvidia estimates that the LTE market will grow more than 100% by 2016.

Intel introduced a series of new chip products and updates during the Mobile World Congress in February this year. The company's first LTE solution, the 7160, now powers the Asus Fonepad 7 and the Samsung Galaxy Note 3 Neo. This LTE chip had previously only been available on the Samsung Galaxy Tab 3. Intel expects to start shipping the CAT 6 LTE solution, aka the 7260, this quarter.

Additionally, Intel showcased its next-gen Atom SoC products -- the Atom Z34 SoC family (Merrifield), the Atom Z35 line (Moorefield), Cherry Trail, and SoFIA. The Merrifield chips will start shipping in smartphones in the current quarter, while Moorefield will make its market debut in the second half of the current fiscal year. Both Cherry Trail and SoFIA will become available toward the end of the current year.

Intel also announced multi-year, multi-device agreements with Lenovo, Asus, Dell, and Foxconn to expand the availability of out-of-base tablets and smartphones.

Intel's multimode, multiband 4G LTE solution (XMM7160) started shipping in September 2013. Prior to this, the company only shipped single-mode 4G-LTE solutions. The company introduced a next-gen LTE cellular modem and Atom chipset for mobile devices -- the XMM 7260. The chip will be available in every large LTE market in the current quarter. It will sell the XMM 7260 mobile device makers as a stand-alone unit, with integrated chips likely becoming available toward the end of the year thanks to the launch of the SoFIA chip.

Subsidies to accelerate tablet growth, contra-revenue to fall
IDC predicts that tablet shipments will surpass PC shipments by the end of 2015 with growth from 227 million units shipped in 2013 to 406 million units in 2017, a compound annual growth rate of 15.6%.

Intel announced during its first-quarter 2014 earnings call that it had shipped 5 million tablet chips during the quarter and was on target to ship 40 million tablet ships in fiscal 2014. The company managed to ship just 10 million tablet chips for the whole of 2013.

Intel has been offering heavy subsidies to chip manufacturers to entice them to use its new chips in their future tablets. For instance, Intel is paying tablet makers to cover the additional BOM, or bill of materials, costs of using its Bay Trail chips instead of ARM-based processors. This has resulted in the company incurring contra-revenue charges on its accounts, which badly impacts its bottom line. Additionally, the contra-revenue often offsets the ramp ups in the company's tablet sales.

However, Intel believes that it will no longer have to subsidize tablet manufacturers once its products hit the markets toward the end of 2014. For instance, a Broxton tablet will have a BOM of about $20 less than that of a Bay Trail tablet. Additionally, greater chip integration using SoFIA, as well as smaller die sizes, will further enhance the cost savings.

Stabilizing PC market
As an aside, I think it's worth mentioning that the beleaguered PC market is now showing strong signs of being close to bottoming out. Intel's PC Client Group revenue declined 1% in the first quarter while PC shipments declined 4.4% globally. The company is also seeing stronger demand in emerging markets.

Foolish takeaway
Intel looks set to dominate the important mobile market soon which gives it better growth runways as it transitions from the PC to the mobile era. This makes it a strong long-term growth bet, and a good investment.

Pullbacks for the stock market have been few and far between lately, but investors have seen a fairly substantial downward move in stocks over the past couple of days. With the stock market still very close to record highs, there aren't that many stocks setting yearly lows, but a sustained correction could make that number soar if the market finally changes gears from its buy-the-dips mentality. Already, we've seen some well-known stocks reach new lows, including Krispy Kreme , MBIA , and ITT Educational Services .

Source: Krispy Kreme.

Krispy Kreme gave up 1% as competition in the doughnut space has ramped up recently. With its most recent reports indicating that customer traffic has been on the decline, Krispy Kreme is now having to deal with aggressive expansion plans from rival Dunkin' Brands as well as other breakfast- and coffee-oriented chains. In particular, Starbucks has ramped up its food offerings once again as it tries to become a destination eatery as well as a coffee giant, and those efforts could lead Krispy Kreme to miss out on an important part of its overall business. Even with the declines, though, Krispy Kreme still stands at almost triple its share price from as recently as mid-2012.

Municipal-insurance giant MBIA fell 3.5% as investors continue to worry about the company's exposure to the Puerto Rican bond market. Puerto Rico has a huge amount of debt, but as a territory of the U.S., that debt enjoys favored status as tax-free not only for federal income tax purposes but also for state and local taxes throughout the country. The voracious appetite for tax-favored bonds led to massive debt offerings, but now, investors are concerned that the territory won't be able to repay those bonds without a huge default. In turn, to the extent that MBIA might be liable for guarantees on those Puerto Rican bonds, shareholders are nervous that a hard-fought recovery from the financial crisis might be all for nothing. With estimates of nearly $5 billion in potential exposure to Puerto Rico, MBIA will need to address investor concerns quickly in order to avoid another crisis.

Source: Dwight Burdette.

ITT Educational Services dropped 1.5% as trouble in the for-profit education sector continued to brew. Last week, ITT found out that because it missed a deadline to file its financial reports, it could see a drop in funding from the U.S. government, which is a key source that many of its students rely on to finance their education. The government wants ITT to account for its student-loan liability properly, but thus far, the company hasn't complied with the directive. Meanwhile, the decision from for-profit peer Corinthian Colleges to put its underperforming schools up for sale reflects just how serious regulators are about ensuring that federal aid is used in as efficient a manner as possible. ITT could continue to see heightened scrutiny until it establishes it's back on firm financial footing.

Fast food is getting faster thanks to mobile ordering apps. Panera Bread and others already have one, Starbucks is initiating a pilot program to test it, and now even McDonald's is giving it a shot at 22 locations to start. Is it just a gimmick that only a minority of customers appreciate? Maybe. But the minority can make a world of difference. Just ask Domino's Pizza and Papa John's .

Source: McDonald's.

McD's ordering
The benefits to consumers should be obvious. You can order your Big Mac from McDonald's without having to verbally place an order, wait for a cashier, or even wait in line at all, with in-store pickup or curbside delivery. Precious minutes and convenience could easily make the difference for those in a rush.

For Starbucks, it's similar. Sometimes the lines are just so ridiculous that it's just not worth the wait. If the Starbucks pilot program succeeds, the semi-humiliating, kindergarten-like ritual of having to give your name for the worker to write on a cup could become a thing of the past (they always misspell my name -- why I don't just make up an easy name like "Jill," I have no idea).

Panera Bread almost always has an annoying wait, and ordering ahead could be a blessing for many. The company expects the adoption rate from its customers to be in the low single-digit percentage range. You get my point (beyond that I apparently visit chains a lot in the name of culinary journalism).

The real benefit that McDonald's, Starbucks, and Panera Bread may see
Turn to Domino's Pizza and Papa John's for insight on this matter. Mobile ordering apps may be new or even still in testing for many restaurants, but at Domino's Pizza and Papa John's, they've already been around for several years. In fact, Papa John's is proud to announce that digital (including PC) sales make up close to 50% of its sales domestically, and Domino's is not too far behind.

The digital sales contribution has moved beyond the computer and over to the tablet and smartphone. Both Domino's Pizza and Papa John's reported that the super-convenience of the advanced apps that save consumers' favorite orders, credit card info, etc. has resulted in consumers ditching the mom-and-pop and even regional chains.  Even the national Pizza Hut chain with its inferior app is feeling the pain.

Local pizzerias are losing sales one by one, and in some cases even going under just thanks to digital (including mobile) ordering. Granted, McDonald's, Starbucks, and Panera Bread differ greatly from restaurants that deliver pizza. Ordering from Domino's Pizza or Papa John's via mobile app for home or office delivery may provide far greater convenience than ordering a quarter pounder with cheese to pick up.

Source: McDonald's.

The vocal minority
However, you know that at least a minority of the population will indeed rely on the order apps that the mom-and-pop restaurants lack. In a restaurant world where it's all about trying to squeeze out another 1% or 2% in domestic same-store sales, McDonald's just needs that little boost to make all of the difference

For example, for the month of May, McDonald's saw a 1% drop in domestic same-store sales. Perhaps if the mobile ordering app had been in place nationally, it would have reported a result in the black instead.

It's the same thing at Panera Bread and Starbucks. At least a handful of people, a number that will grow over time, will skip Bob's Coffee House or Sam's Subs & Sodas and go for the mobile ordering app to grab a quicker bite to eat at Panera Bread or treat themselves to a fast Frappuccino from Starbucks on the way back to the office.

One final random semi-Foolish thought
What if the entire world switches to mobile ordering? The line may end up longer for pickup than for ordering the old-fashioned way. That kind of reminds me of the drive-thrus at McDonald's. Sometimes there will be a parade of cars waiting outside, yet the inside is empty. I'm in and out in seconds.

Anyway, it will be interesting to see how our world changes around us as well as how our investments are affected. Digital ordering, including the rapidly growing mobile ordering, has turned Domino's Pizza and Papa John's into hyper-growth stocks again. Perhaps we'll see, even if on a smaller scale, a bit of the same with Starbucks, Panera Bread, and/or McDonald's.

It's well known that Taiwan Semiconductor had a virtual monopoly on 28-nanometer capacity during 2011 and 2012. Samsung , which looks to be on track to be the second largest general purpose foundry, managed to get its own 28-nanometer process out in high volume in time for Apple's iPhone 5s ramp, but this was years after TSMC began shipping wafers to customers.

The question, however, is whether TSMC -- which enjoyed robust margin expansion as a result of this 28-nanometer lead -- will be able to continue this pseudo-monopoly going forward.

28-nanometer is getting crowded
With Samsung, Semiconductor Manufacturing International , Global Foundries, and United Microelectronics all ready (or readying) viable 28-nanometer manufacturing technologies, the 28-nanometer market is going to get pretty crowded.

In fact, Semiconductor Manufacturing International recently scored 28-nanometer orders for Qualcomm's Snapdragon processors (the world's most popular mobile chips), and is even readying specialty processes for things like RF front end in a bid to capture even more Qualcomm business. 

The good news for TSMC is that at this point, its cost structure is probably better as the 28-nanometer factories have been running for quite some time, which means that the ability to compete on price on the part of its competitors is probably limited.

Additionally, TSMC's yields are probably better as it has had more time to improve them (which again helps TSMC's cost structure/margins). The bad news is that with more competition, average revenue per wafer could come down a bit.

Beyond 28-nanometer? We'll see.
There have been a lot of claims from many of the other semiconductor foundries claiming that the move to 20-nanometer and the 14-nanometer FinFET node will be extremely swift, but this is simply hard to believe. Moving from one manufacturing node to another has been getting harder, not easier, both from the actual manufacturing side of things as well as from the design side of things.

It seems unlikely that TSMC -- which has been ahead at 28, and now at 20 -- will all of a sudden "lose" its lead at next-generation nodes in terms of when products ramp at good yields in volume to the market. If this thesis holds true, then TSMC should continue to have cost structure and pricing power advantages at next-generation manufacturing technologies relative to its general-purpose foundry peers.

Foolish bottom line
It does seem likely that competition at 28-nanometer will intensify, which could somewhat pressure TSMC's margins and market share. However, it looks like TSMC should have a non-trivial lead over its general-purpose foundry competitors at the leading edge. If this is the case, then TSMC should be able to continue its robust revenue growth (as wafer prices continue to rise) as well as its high-40% gross margin profile.

VMware has established itself as the leader in virtualization, commanding 64% of the virtualized server market in 2013, according to IT Candor. It has been delivering solid performance, beating earnings estimates in each of the last four quarters. This is remarkable, as VMware faces stiff competition from a bigger technology player such as Microsoft , while smaller rivals such as Red Hat are trying to gain a footing in this market.

A look at VMware's business will reveal why its dominance will continue.

The virtualization opportunity
The IT industry is undergoing a significant shift from client-server computing to the mobile cloud, offering customers secure, seamless, and immediate access to applications and data they require. Therefore, major IT companies are increasingly replacing their hardware-defined data centers with software-defined data centers, where all core components are virtualized and infrastructure is highly automated.

VMware is assisting customers in unlocking the value hidden in software-defined data centers. It is focusing on three strategic priorities -- the software-defined data centers, hybrid cloud, and its end-user computing business.

The software-defined data center, with computer and network virtualization as its foundation, is expected to help enterprises address modern security needs in an innovative way. As a result, VMware is seeing strong customer momentum, driven by new customer trials. 

Focus on products
To address the needs of customers, VMware recently launched Virtual SAN, which is a new storage solution designed for virtual environments. The company is rapidly executing on its hybrid cloud vision. Its vCloud Hybrid Service enables organizations to extend their data centers to the cloud. 

The company is trying to deliver a complete suite of solutions to customers with services such as vCloud Hybrid Service Disaster Recovery. This is a unique hybrid cloud-based service that provides an affordable way for customers to protect their data centers. Customer feedback for this service has been positive.

Despite having the leading position, VMware believes it can still gain share in desktop virtualization. Horizon desktop-as-a-service, or DaaS, a new cloud-based desktop service introduced in the first quarter, is receiving robust customer attention. This service delivers enterprise-class virtual desktops, running on VMware vCloud Hybrid Service. 

VMware has also announced VMware Horizon 6, a highly integrated solution that delivers published applications and desktop virtualization on a single platform. Horizon 6 leverages highly differentiated integration with software-defined data center components like Virtual SAN and cloud management.

End-user computing prospects
VMware's end-user computing group is also gaining traction, driven by the acquisition of AirWatch, which provides enterprise mobile management and security solutions. This acquisition has helped VMware gain strong customer momentum, as AirWatch has approximately 12,000 customers.

License bookings for end-user computing, including AirWatch, were up 35% on a year-over-year basis in the first quarter. The company is trying to sustain the momentum in end-user computing. It has expanded its ecosystem by strategically partnering with Google.

VMware will provide secure cloud access to Windows desktops, apps, and data on Google Chromebooks through its DaaS platform. It has also enhanced its partnership with F5 Networks to deploy secure access control for virtual desktop deployment. In addition, NVIDIA will be providing rich graphics performance via DaaS to VMware's platform. The company has also extended its partnership with Palo Alto Networks to deliver an integrated solution, while providing strong security across customers' physical and virtual environments with a single point of management. 

Competitive threats
VMware's moves should allow it to stay ahead of the game in virtualization, where Microsoft and Red Hat are making good progress. Microsoft's virtualization platform, Hyper-V, is cheaper than VMware's vSphere Enterprise Edition. The software giant has continued to add new features to Hyper-V. Microsoft also has the advantage of leveraging its current Windows client relationships to improve its position in the virtualization market. 

Since Microsoft is the second-biggest player in virtualized servers, VMware will have to keep a close eye on its moves.

Meanwhile, Red Hat is also trying to gain a bigger share of the virtualization market by way of acquisitions. It recently acquired eNovance, a key player in open-source cloud computing. eNovance's client list is impressive, as it has around 150 global customers that include Alcatel-Lucent, Cisco, Cloudwatt, and Ericsson. This acquisition will allow Red Hat to reach more customers with its OpenStack technology. 

The takeaway
VMware's focus on delivering solid products and services should aid its growth in the long run. Moreover, the company's balance sheet is also in good health with a cash position of $6.6 billion and debt of just $1.5 billion. Finally, at a forward P/E ratio of 23, VMware looks like a good buy as its earnings are expected to increase at a compound annual rate of 16% over the next five years.

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Zulily Inc. were getting torn apart today, falling as much as 10% and finishing down 7% on a momentum-sell off that swept the market.

So what: There was no major news pushing shares of the mom-focused online retailer down today as the Nasdaq fell 1.4% and the small-cap Russell 2000 index also dropped 1.2% on a broad sell-off. Other big names to fall for no good reason included Twitter, which slid 7%, and Yelp, which also lost 7%. Concerns that stocks may be overvalued as earnings season kicks off seemed to drive today's sell-off, and momentum stocks have been particularly volatile over the past few months.

Now what: Zulily shareholders are no stranger to wild swings at this point. After debuting at $22 a share in November, the stock rocketed as high as $73 in February on a blowout earnings report. Since then, the share price has returned back to earth, falling in May after missing expectations in a follow-up quarterly report. Expectations for Zulily are high, and the company is posting incredible top-line growth numbers, with sales expected to jump 72% this year alone. Still, it will be a while before profits can justify the $34 share price it trades at today. I'd encourage investors to ignore today's momentum-based drop, but this highflier could easily see more disappointing days if near-term results come up short.

Since the past several months, networking giant Cisco   has been transitioning its collaboration services from telepresence to less expensive cloud-based software applications. For that matter, it currently operates WebEx and Jabber. The former provides web conferencing, while the latter contains a variety of tools like instant messaging, IP-based voice and video, and desktop sharing.

Recently, the company acquired Assemblage, a collaboration start-up that offers screen sharing, whiteboarding, web presentations, and is able to support up to 40 different types of files. As Cisco incorporates Assemblage's strengths in its current collaboration unit, it could further differentiate itself from top rival, Polycom . Overall, Cisco is taking action to expand its reach in the collaboration tech service market, simplifying its systems and favoring interoperability as part of its Internet of Things plan.

Growing cloud-based collaboration software unit
In past years, Cisco made substantial, growing revenue from telepresence and sales of hardware equipment, charging high prices that were mainly targeted to large enterprises. However, this service's growth has started to slow down due to the appearance of cheaper and simpler cloud-based software for web conferencing. Cisco experienced an annual 6% drop in sales of collaboration products from 2012 to 2013.

Yet, while its videoconferencing hardware experiences difficulties, its cloud-based collaboration applications are growing. In its latest quarter, its total collaboration sales fell 12% year-over-year, but revenue from WebEx increased by 7%.

Merging hardware with system and software service
In May, Cisco launched two new desktop endpoints for video conferencing, the DX80 and DX70, which are priced between $1000 and $2000. Its aim is to enable organizations to engage in video meetings outside of the habitual conference room.

Although it seems like an expensive service, the company is confident that its user-friendly and sophisticated aspects justifies the price. Moreover, it offers the SX10 and MX200 (along with larger sized models) for the lower and mid end of the industry.

Whether they are low or high end, Cisco's video conferencing devices favor the usage of the WebEx system, which could engage customers to the cloud-based collaboration software ecosystem. With Assemblage, the company can simplify its software collaboration systems to a great extent, as the start-up offers short links that enable its users to share screen content, video, and use other collaboration tools without the need to download any apps.

The newly acquired start-up also worked to include its services with Google and Box. Now, Cisco looks forward to replicate this in its software collaboration unit, and so increase its interoperability. In that sense, the company differentiates itself by offering an efficient collaborative work environment, and getting rid of the usual technology difficulties involved in the conferencing process.

Rivalry with Polycom
One of Cisco's top rivals is Polycom, which aims strongly at large enterprises in order to sell its high-end service called RealPresence. In that manner, it competes directly with Cisco's TelePresence. In its most recent quarter results, Polycom reported revenue of $329 million, decreasing 2.9% year-over-year yet beating analyst expectations by $1.51 million. 

As several cloud-based software conferencing companies emerge, Polycom's high-end services undergo risk. So far, Cisco shows more signs that it is adapting to this market, as the organization launches new initiatives and constantly improves its software collaboration unit. 

On the other hand, in regards to Cisco, it might seem like its cheaper conferencing alternatives could cannibalize its own expensive offers. Yet, a key factor that keeps both Cisco and Polycom going in the high-end segment is the high willingness to pay and invest from large enterprises. Certainly, these may make up a small portion of the total collaboration tech and software customers, but both companies are still on the lookout to capitalize the existing demand.

Final foolish takeaway
Cisco aims to improve its collaboration tech unit by taking advantage of the varied willingness to pay of customers. As a result, it offers hardware devices that suit enterprises from the low to high end of the market. Moreover, it provides the user-friendly, sophisticated software, WebEx for video conferencing, and Jabber for other collaboration tools. Through Assemblage, the company can improve its collaboration software, simplifying it and adding interoperability with other cloud services. Since it could expand its reach in the market, Cisco is placing itself in a threatening spot for rival Polycom, which mostly limits itself to high-end collaboration services.

U.S. stocks notched up their second straight day of losses on Tuesday, with the benchmark S&P 500 and the narrower Dow Jones Industrial Average both declining 0.7%. The technology-heavy Nasdaq Composite Index was down 1.3%.

Registering some of the largest declines on Tuesday were two high-profile growth stocks: Facebook (-3.9%) and Twitter (-7%). However, it looks like those drops were symptomatic of a broader punishment meted out by investors against growth momentum names. Where does that leave the shares of the two competing social networks?

The dramatic decline in asset price volatility has not gone unnoticed, including in this column, but the market isn't monolithic. Look around you and you'll find pockets of volatility, or as Bespoke Investment Group remarked this morning in a tweet:

Momentum names acting like they did in March and April last two days. Definitely going to hit sentiment hard.

— Bespoke (@bespokeinvest) July 8, 2014

"Sentiment" is the key term here. Financial journalists and pundits always bend over backwards to explain stock price movements, even when the underlying reason is not much more profound or instructive than "more buying than selling" (or vice versa.) With regard to Twitter's fall, for example, TechCrunch pointed to another executive shuffle, but it's unlikely that would have accounted for anything more than a fraction of the 7% stock price decline.

Speaking on CNBC, a SunTrust Robinson Humphrey Internet equity analyst identified a more likely culprit: a highly anticipated research report published late yesterday with a monthly active user estimate for Twitter that was lower than the current consensus estimate of 266 million. (The organization that produced the report had -- either through luck or talent -- produced a very accurate estimate one quarter ago.)

But if we use Facebook's nearly 4% decline as a proxy -- I could find no story of any real significance affecting Facebook today -- the disappointing report on Twitter would account for less than half the drop in its stock. The simple truth is that, given its valuation and its "investor" base, Twitter is at the sharp end of the spear when it comes to shifts in investor sentiment, whether they are stock-specific or whether they affect a broad swath of momentum names, such as the one we appear to have witnessed over the past two days.

Even after today's drop, Twitter's stock looks far from cheap, at 144 times next year's earnings-per-share estimate of $0.26. Make no mistake about it: Twitter looks like it could develop into a decent business, but at its current valuation, the stock remains a highly speculative operation. Facebook shares, on the other hand, are now valued at a relatively pedestrian 34 times next year's estimated earnings per share; if the current downdraft in momentum names continues, they could soon approach fair value. A more dominant franchise at a better valuation -- that's not a difficult choice, in my book.

A two-day decline for the Dow Jones Industrials shouldn't be particularly noteworthy, even when it meant the Dow lost its hard-fought 17,000 milestone. Yet today's 117-point drop for the Dow has left investors nervous about what tomorrow will bring, with minutes from the Federal Reserve combining with the beginning of second-quarter earnings season to provide some answers to the future course of the U.S. economy. Today's drop sent more than two dozen Dow components falling, but investors emphasized the value of defensive names, sending Wal-Mart and Procter & Gamble to modest but significant gains Tuesday.

Source: Wal-Mart.

Wal-Mart climbed three-quarters of a percent even as the chief of the retailer's U.S. division reiterated some troubling news for the company. Bill Simon noted that even with the economy back on a growth trajectory, Wal-Mart isn't seeing shopping activity rise as quickly as the company would ordinarily expect this long after the last recession. Yet part of Wal-Mart's appeal during the 2008 recession was that customers who had previously shopped at more upscale retailers looked to Wal-Mart for bargain opportunities. Moreover, Wal-Mart has made numerous efforts to adapt to changing conditions in the retail industry, using a small-store footprint to encourage repeat trips and address the higher fuel costs of having to drive longer distances to big-box format stores. If Wal-Mart can capture daily business as well as longer-term stocking-up trips among consumers, then it could finally turn around its ailing domestic sales and defend itself against competition from deep-discount stores and online specialists.

Source: P&G.

Procter & Gamble gained almost half a percent. The consumer-products giant has a lot riding on its growth initiatives, with the stock's current valuation implying much faster earnings growth than Procter & Gamble has been able to produce in recent years. Still, P&G has done a reasonably good job at reawakening its ability to come up with innovative new products, and at the same time, it has also figured out how to focus more on what it sees as its best business prospects while divesting itself of non-core divisions. Even so, though, Procter & Gamble's hefty earnings multiple gives shareholders less margin of safety than they're used to getting from a defensive stock.

The Dow Jones Industrials have produced minor drops countless times during the bull market, only to bounce back and reach toward new record highs again. Nevertheless, interest in defensive Dow names like Wal-Mart and Procter & Gamble is just one more signal that investors might think the good times for the Dow might be coming to an end.

Intel started its Intel Custom Foundry business back in 2010. To date, this has not been a meaningful revenue source for the company, but the progress is becoming more visible.

Intel's previous CEO, Paul Otellini, was adamant in that the company's foundry business was a very selective business and that it would avoid trying to go toe-to-toe with foundry giant Taiwan Semiconductor . Under new CEO Brian Krzanich does this still hold true? Does TSMC have anything to worry about? 

Intel Custom Foundry is probably not a huge direct threat
If you look at some of the deals that Intel has publicly announced, you'll note that the companies using Intel's foundry services are generally building really big, very cost-insensitive parts. Intel has made it clear that even though it is opening its foundries up to more potential customers, it still plans on being paid for the value that it delivers with its leading-edge technologies.

Further, many of TSMC's high-volume customers -- think Qualcomm -- are unlikely to build at Intel for a variety of reasons, an obvious one being that Intel is spending billions developing products that compete with Qualcomm. Less obvious is that giving Qualcomm access to leading-edge manufacturing could indirectly affect PC sales via mobile chip cannibalization.

However, Intel itself is a threat
While Intel Custom Foundry is likely to have minimal impact on TSMC's revenues, Intel's own mobile efforts could represent a threat. Every point of smartphone and tablet share that Intel gains with its own home-grown products is a chip that the foundry landscape in general, which TSMC dominates, doesn't get to build. If enough leading-edge volume is sucked out of the foundry landscape, then it becomes difficult for these companies to invest as rapidly in leading-edge R&D and capacity expansion.

However, any material threat from Intel's mobile products is unlikely to materialize until late 2015 or early 2016. This is when Intel will bring its high end, 14-nanometer Atom applications processor for phones and tablets codenamed Broxton to market. Further, Q1 2016 is when Intel will bring its integrated apps processor and cellular solution built on 14-nanometer to market.

This is when Intel-built products could become very competitive in the high-volume tablet and phone markets, and this is when Intel could stand to gain material share from TSMC.

Foolish bottom line
Over the next year, TSMC should enjoy a number of very nice tailwinds. It's likely that it has future Apple business in the bag, and Qualcomm will probably remain unchallenged in the smartphone applications processor market during the majority of 2015. (Any share that Intel gains with SoFIA -- its first integrated apps processor and modem -- is business for TSMC anyway.)

However, as we move into 2016, Intel becomes a much more serious threat to the semiconductor foundry players with its Atom products. While only time will tell whether these 14-nanometer Atoms will be enough to win high-volume phone designs, this is something that TSMC investors should keep a closer eye on as 2015 winds to a close. 

Microsoft   recently pulled a marketing and sales stunt that surprised everyone. In an attempt to sway devoted Mac users over to Microsoft's new Surface Pro 3 tablet, it's offering a $650 rebate to consumers to trade up to Microsoft's new Surface Pro 3, provided they hand in their MacBook Air in working condition.

However, Microsoft's work is cut out for it in more ways than one. Not only will taking market share from Apple  not be easy, but gaining traction in the tablet space will be just as hard. 

Apple's market share has been immune to the PC slide
Apple has been gaining market share even as PCs shipments have trended lower. According to Gartner, U.S. Mac sales spiked 28.5% year over year in the fourth quarter of 2013, giving Apple a 13.7% share of the U.S. market even while the PC industry continues to struggle.

According to Apple, thanks to strong MacBook Pro and MacBook Air sales, Macs have gained global market share for 31 of the last 32 two quarters.

This is a trend that might continue, especially now that Apple has lowered the price barrier to the Apple ecosystem. Apple's new 21.5-inch iMac costs only $1,099, while the new MacBook Air starts at only $899. 

Apple has a very loyal consumer following 
Devoted Mac users aside, according to the American Customer Satisfaction Index, Apple has been topping Customer Satisfaction Benchmarks in the PC category for over a decade now.

Source: American Customer Satisfaction Index 

You don't score No. 1 year after year without a reason. No matter what investors might think of Apple products, consumers (customers) think very highly of Macs. It's no wonder, either, just days after the Surface Pro 3 went on sale, buyers began grumbling about poor performance on Wi-Fi networks using the 802.11ac standard.

More juice is better
One of the reasons why the MacBook Air got to be so popular is because its battery lasts anywhere from 9-12 hours depending on the model. Microsoft claims that the battery of the Surface Pro 3 can last you up to nine hours. This is good, but if you want the longest-lasting laptop on the market, then the MacBook Air is still the best choice.

Microsoft's Surface Pro 3 is not a bargain 
If one wants to compare apples-to-Apples (pun intended), then one has to add the extra cost of a keyboard to the Surface Pro 3. When all is said and done, the Surface Pro 3 will cost you a total of about $1,129. The total cost comes down to $479 with the $650 rebate. However, while Microsoft might persuade a few Mac addicts to buy the Surface Pro 3 for $479, I am not so sure how many more MacBook Air owners will be persuaded once the special offer ends. Please keep in mind that the $1,129 price tag is for an entry-level Surface Pro, and for the same price you can buy the top-of-the-line MacBook Air.

Microsoft might be too little too late in the tablet game
IDC's Tom Mainelli, research director for Tablets, had this to say a while ago:

It's becoming increasingly clear that markets such as the U.S. are reaching high levels of consumer saturation and while emerging markets continue to show strong growth this has not been enough to sustain the dramatic worldwide growth rates of years past. We expect commercial purchases of tablets to continue to accelerate in mature markets, but softness in the consumer segment—brought about by high penetration rates and increased competition for the consumer dollar—point to a more challenging environment for tablets in 2014 and beyond.

That's not to say that Microsoft will not be able to gain market share in the tablet space, but it will be a challenge. For example, according to IDC, while Apple grew it tablet business by 13.5% year over year, Samsung  registered 85% growth year over year . In a strange way, Microsoft might be better off giving a rebate to Samsung users than Apple users.

In fact, even if we assume Microsoft manages to take some business from Apple, Google   might be an even bigger competitor. According to the NPD Group, Chromebooks accounted for 21 percent of all business and educational notebook sales in 2013, up from a negligible share in 2012. And with Lenovo, Hewlett Packard Samsung and Acer also entering the Chromebook space,  Microsoft will have its hands full trying to compete for a segment of the laptop and notebook space.

Bottom line
Being a latecomer to the tablet space, Microsoft is responding in desperate ways to encourage people to buy its tablet PC. The problem is that MacBooks were never about price, but about performance; Microsoft might be barking up the wrong tree. In addition, the fact that Apple ranks so highly in customer satisfaction and that the Surface Pro 3 is not that much of a bargain (without promotional discounts) will make Microsoft's job even more difficult. 

Stocks fell for the second straight day as momentum names got creamed ahead of the start of earnings season. By the end of the session, the Dow Jones Industrial Average  had lost 118 points, or 0.7%, while the S&P 500 was down 0.7%, and the Nasdaq plummeted 1.4% as Internet stocks fell sharply. Among them, Twitter and Yelp both dropped 7%. 

In today's economic reports, the Department of Labor said job openings increased 3.8% to 4.63 million in May, beating expectations at 4.35 million, and that figure improved 19.8% from a year ago, adding yet another data point to many that show the labor market quickly improving. The tally was highest since June 2007, perhaps the best evidence that the job market is approaching normal. Elsewhere, consumer credit rose more than expected in May, increasing $19.6 billion to $3.19 trillion. Auto and student loans increased by more than they had in a year, and economists interpreted the report as a sign that the improving economy was giving consumers confidence to borrow more money.

In the unofficial signal that earnings season has begun, Alcoa  released its quarterly results after hours today, gaining 1.1% on the news. The aluminum manufacturer posted an adjusted profit of $0.18 a share, following a loss of $0.11 a year ago, and beat estimates of $0.13. Revenue was essentially flat, edging down from $5.85 billion to $5.84 billion, but that managed to top expectations at $5.63 billion. With aluminum prices still low because of a production slowdown in China, Alcoa has reduced capacity at some of its older plants and has focused more on the finished-goods side of the business. The strategy seems to be paying off, as the stock has rallied 90% in the past year. The manufacturer also confirmed its forecast for a 7% increase in demand this year and said prices had gone up 2.4% in the past year. 

Elsewere, shares of The Container Store  were getting squeezed after hours, falling 18% after another disappointing earnings report. The newly public retailer said same-store sales fell 0.8% in the quarter, and CEO Kip Tindell blamed an industrywide "funk," noting that other retailers had struggled in the quarter. Overall, sales improved 8.6% to $173.4 million, just shy of estimates at $174.2 million, while on the bottom line the company reported a per-share loss of $0.07, a penny worse than estimates. What really seemed to shake investors, however, was the company's dialed-down guidance for the year, as it now sees EPS of $0.49-$0.54 versus a previous range of $0.56-$0.61. Tindell noted that the first quarter has little impact on the year's profits, 60% of which come from the fourth quarter, but the lowered guidance is a warning sign for the high-priced recent IPO. The company expects comps to turn positive for the rest of the year, but the expansion story seems overhyped, as its 2014 P/E is still lofty, sitting above 40. I wouldn't expect shares to return to their $36 IPO price anytime soon.