Sony Corporation ADR (NYSE:SNE) is slated to deliver Q3 results on January 30, 2007. My editors asked if I'd switch gears from activist to researcher and provide a lead in for that earnings report. Being one to blindly serve the desires of my superiors, I quickly consented to undertake the task (irony intended).

Almost everyone I talk to seems to think that the name Sony is synonymous with PS3. If that is the case, then almost everyone also knows that Sony has fallen flat. Indeed it's been a tough fiscal year so far for our friends at Sony. Bank of New York shows that thus far Sony is posting annual EPS of $0.74 for 2006. That's $0.26 off from the previous year. Sony's Q3 earnings estimate for 2006 is $0.28 which would represent a modest improvement over the previous four quarters but it would still be a pitiful showing when compared to $1.37 for the same quarter last year. MSN Money, Stock Scouter gives Sony less than stellar marks for current fundamentals pointing out a lack of growth in comparison to the previous three years.

So what does Sony have up its sleeve for 2007? I can't find much Sony excitement anywhere. It would seem that it's doing fairly well with its sales of mobile handsets, but then who isn't. When I look over its list of product offerings including but not limited to CD players, televisions and GPS, I fail to find any brightly shining stars. That's okay if you're into mediocrity I guess. In an article by Troy Wolverton at TheStreet.com, he states: "Sony Chairman and CEO Nobuyuki Idei warned that the company's results may not improve any time soon." The article goes on to quote CEO Idei directly stating, "Sony reiterates its belief that strengthening the competitiveness of our electronics products is the most pressing issue facing our management today."

I personally still like Sony as a company overall, but my opinion is that Sony investors will need to take the upcoming earnings report with a grain of salt or a spoonful or two. I'm really sorry to be so blunt but Sony has failed to excite me this year. Perhaps it will fix that some time in the future with PS4. Umm, but I wouldn't hold my breath ...

Also check out some other earnings reports that we're following, and let us know your thoughts on earnings expectations.

In breaking after-market-close results, International Business Machines Corp. (NYSE:IBM)'s third-quarter earnings were up 47% with a 5.1% increase in sales to $22.62 billion; a huge bit of good news for Big Blue.

On the other side of the coin was Motorola, Inc. (NYSE:MOT). Oh, how the mighty mobile company has fallen. Third quarter 2006 earnings for Motorola were down 45%, to 39 cents a share, although you could barely tell from the rosy picture painted by the earnings release; full of optimism about sales at $10.7 billion, up 17% from Q3 2005. We're waiting to see how investors react.

Update: investors were thrilled with IBM and sent stock up after hours to $91.32 from a close of $86.95. Motorola was terrible news and investors sent the stock tumbling to $22.90 from its already-lower close of $24.85.

Auto sales weren't so bad after all! we all agreed, shaking hands and congratulating the industry, feeling a bit smug (despite Toyota's walloping of all things American). And at first blush, it looked to be true: sales at Ford Motor Company (NYSE:F) were actually up vs. September 2005, 4.7%, and sales at DaimlerChrysler AG (NYSE:DCX) and General Motors Corporation (NYSE:GM) weren't down as much as many industry watchers feared.

That's all well and good, when you're looking at raw units sold. But Autoblog's John Neff went a little deeper and considered the way auto dealerships operate: in "selling days." September 2006 selling days were 26, vs. only 25 in September 2005. And if you know auto dealerships, the guys behind the desk are really looking at DSR: daily sales rate.

Were we all snookered into placidity by one of the oldest tricks in the car sales guys' book? Here's what John found when he looked at DSR instead of gross sales:

It seemed that every morning of last week I asked in Before the Bell whether today would be the day that the Dow Jones Industrial average would close at its all-time high. But to no avail. Well, today isn't over yet and we still have to wait for the a closing record, but an intraday record has already been reached.

Last I checked, around 1 p.m., the Dow Jones industrial average was at 11,754.47, more than four points over and above its 11,750.28 all-time high set on Jan 14, 2000. Today's high was actually 11,755.35. [Update: at 2 p.m., the DJIA had fallen to just below its high at 11,742.23, but was still on track for a closing bell high.]

Since that January 14, 2000 record day, we've seen the market hit by one thing after another, starting with the dot com bubble burst, terrorism, the economic slowdown that ensued and corporate scandals in the form of Enron and the likes.

Oddly enough, as my colleagues Sarah Gilbert and Amey Stone have both pointed out, this is a different world and a different market and while the Dow climbs, the rest of Wall Street is quite a bit more conservative, analyzing each piece of economic data as it comes out, and each earnings report, before making any decisions. Investors are still not sure whether they should cheer or fear certain indicators that may show inflationary pressures are under control -- but perhaps at the price of the economy.

I'm attending the 2006 Blogher Conference in San Jose, California, and many of the net femarati are here. I just finished listening to an enlightening talk by the co-founder of Blogger (now owned by Google), Meg Hourihan, and the co-founder of flickr (now owned by Yahoo!), Caterina Fake. Moderator Marnie Webb pointed out that both of the products for which the two speakers are famous, were accidental by-products of their respective companies' original mission.

Fake was working with her co-founders on a role-playing game, while Hourihan was working on project management software. Declaring the concept of a stealth period "dead," the flickr co-founder mentioned that user feedback was central in determining how the photo sharing software would be shaped; and Hourihan echoed that sentiment with regards to the very useful blogging software her company, Pyra, developed just for fun. "If we had started out to create a photo sharing site, it never would have happened," said Fake. "We would have done market research, and discovered that all the money was in on-demand printing, and that took too much capital investment, and we'd never make money. We would have decided it wasn't worth it."

It's quite an interesting detail of product history and it's amazing to think how many great, world-changing products were accidental. What's more, it's worth considering from a management strategy point of view: how does a company encourage its employees to invest time in offshoots of the central strategy, and then fail to analyze those happy accidents to death? Are big companies forever destined to buy these providential mistakes simply because they never would have made sense, had they been "product developed"? Even Google, king of the entrepreneurial, "throw it up against the wall and see what sticks" spirit, had to buy Blogger. Which companies are best positioned to find and care for accidental successes?

Second quarter earnings exceeded expectations, with $2.455 billion in total revenue for the quarter (up 77% year-over-year) and $2.33 earnings per diluted share. After the bell, investors seemed happy; the stock was recovering from its intraday drop of $11.88, although as the minutes ticked by, the recovery was less and less.

It will be interesting to watch as investors digest the report, and listen to the earnings conference call. I've just started listening, and it's a numbers-rattle-off right now.

4:41 p.m. -- Sergey Brin begins the call, talking about the details of the earnings report. He says that the company noted earlier that capex would be higher, as a percentage, than it was last year, and it continues to be, up to 12% of revenue from 10% last year -- that's a lot of dollars given the huge growth in revenue. Headcount was up over 1,000 people, mostly in Ireland and India.

4:44 p.m. -- Larry Page takes over to talk about the warmer, fuzzier parts of the business. He focuses on Google Checkout, which is hoped to help advertisers generate more sales. He says that Google's option will help advertisers capture those customers who abandon their shopping carts, and generate higher clickthroughs. He says they are "generating healthy adoption rates" including Bluefly, Starbucks, and more.

4:48 p.m. -- Page thinks this is one of the most exciting products the company has generated to date, and "hopes" it will bring revenues. Naturally investors want this: 99% of Google's revenues, healthy as they are, are still coming from search advertising.