HP has reported its fiscal second-quarter financials, pointing to a slight slide in net revenues to $30.7 billion. Earnings per share fell to $0.80, slightly higher than the internal forecast of $0.68 to $0.71, however the company nonetheless confirmed plans to eliminate eight percent of its workforce.
The imbroglio over Facebook's initial public offering continued today with the announcement of a class-action lawsuit alleging wrongdoing on the part of Facebook and its underwriters. The lawsuit, filed in Manhattan federal court, claims that Facebook, Morgan Stanley, Goldman Sachs, and JPMorgan Chase, among others, misled investors and caused them to lose more than $2.5 billion in the wake of the IPO. As Bloomberg reports, the plaintiffs have yet to specify the amount sought for damages. The case comes in the wake of the revelation yesterday that the Securities and Exchange Commission will be looking into the Facebook IPO to determine whether some investors received privileged information ahead of the opening.
The Facebook initial public offering (IPO) may have been hampered by the bank that brought the social network to Wall Street. The LA Times writes, Morgan Stanley was advising favored clients on reduced revenue estimates for Facebook, leading Wall Street insiders to avoid or drop shares. The US Securities and Exchange Commission will be looking into the Facebook IPO, with the Financial Industrial Regulatory Authority also expressing concern, particularly as this resulted in non-institutional investors with more shares than they had intended. With Facebook shares expected to be scarce, some investors over-ordered in the belief that they might miss out if they didn't, leaving them more exposed than they had planned.
Google has announced that its proposed acquisition of Motorola Mobility has been closed, following necessary approvals from the US Department of Justice, European Union and other international agencies. Current Motorola Mobility CEO Sanjay Jha will continue to help complete the transition, however he will step down as chief executive as Google veteran Dennis Woodside takes the leadership role.
After a shaky first day on the NASDAQ index on Friday, Facebook stock on Monday took a dive into the red as most tech stocks showed modest gains. FB shares closed at $34.03, an 11-percent drop from the $38 starting price for the record-setting IPO. The stock closed a few cents over the starting price on Friday, however the valuation was said to have been artificially inflated by underwriters reacting to an immediate falloff.
Facebook's record-setting IPO brought significant attention, however the company's stock price (NASDAQ:FB) ended up just $0.27 above the $38 offering price as the trading day came to a close. Shares started off the day trading at $42.05, 11 percent higher than the offering, however the price quickly fluctuated at lower levels before settling later in the afternoon.
The recent decision by General Motors to cease its paid advertising operations on Facebook may have been the result of a failed pitch on Facebook's part to convince the automaker of the efficacy of advertising on the social network. Sources familiar with dealings between the two companies tell Reuters that Facebook's dual pitches—touting both free media advertising and paid advertising—served only to convince GM that its paid ads weren't effective enough to justify the cost.
Facebook sold 421.2 million shares at $38 each today, Bloomberg reports, raising $16 billion in the largest initial public offering by a technology company in history. The offering caps a storied past few weeks that saw representatives from the social network attempting to build investor confidence, even as reports emerged from other sectors that could well have undercut confidence in the company.
HP is reportedly preparing to reduce its workforce by 10 to 15 percent, displacing approximately 30,000 existing employees, unnamed sources have told AllThingsD. The layoffs are said to be a core element of a restructuring plan that will affect all of the company's divisions.
More troubling news has emerged in the run-up to Facebook's $100 billion initial public offering, as an AP-CNBC poll of Facebook users found only four percent of respondents often clicking on ads from the social network. The poll also found that a solid majority of respondents doubted the safety of purchasing goods and services through Facebook.
T-Mobile CEO Philip Humm has reportedly distributed a memo to employees warning of "difficult decisions" as the company prepares to announce further restructuring plans. The note does not detail the extent of such cuts, though the executive suggests it is forced to find a new strategy that "aligns our costs with our revenue realities" to help the company "return to growth."
A US Tax Court judge has ruled against HP in a lengthy legal case that centers around $190 million in tax payouts to the Internal Revenue Service. The agency years ago disputed the company's tax returns, accusing the company of exaggerating deductions through a complex series of international investments, known as foreign tax credit generation, to slash tax payouts in the US.
The board of Yahoo has accepted the resignation of former CEO Scott Thompson and named Ross Levinsohn, its head of global media, to be the interim CEO. Fred Amoroso, who just recently joined the board of the troubled Internet search engine, was named chairman, and Third Point hedge fund manager Dan Loeb, who had been pushing for Thompson's removal, and two of his proposed directors will join the board.
Mark Zuckerberg has spoken up in the midst of Facebook's ongoing IPO roadshow, giving investors a better idea of what they can expect to be key revenue drivers for the largest social network in the world after it goes public. Zuckerberg says Facebook will set its sights on improving its mobile application, tying other online apps into Facebook, and creating a "transformative" advertising experience.
Intel CEO Paul Otellini has made it clear to investors and reporters that the company will continue to angle for more business from Apple in mobile devices, saying his mission was to "ensure our silicon is so compelling [that] they can't ignore us." Intel is already responsible for the chips in all of Apple's desktop and notebook products, but has longed to replace ARM-based processors as the heart of its mobile lineup, Forbes reports.
On May 7, Forbes published its annual list of the top 25 fastest-growing technology companies. Drawn from a pool of more than 5,000 publicly-traded technology companies, listees must have a sales growth of 10 percent or more for each of the last three fiscal years, a minimum revenue of $150 million, and a minimum market value of $500 million. Six companies have gained place on the list, or held steady. There are 15 new entries in the top 25.
Fortune Magazine released its annual Fortune 500 list of America's largest corporations, and Apple has zoomed up the list to the number 17 slot. The new ranking is a sizable improvement over its 35th -place ranking last year, but the iPad maker still ranks second in technology, behind Hewlett-Packard.
Facebook has finally set an official estimate for its initial public offering, which will offer individual shares for between $28 and $35. The pricing is said to equate to an estimated valuation ranging between $77 billion and $96 billion, slightly lower than the highest analyst estimates but far higher than any other Internet company.
The senior VP of iOS software at Apple, Scott Forstall, sold 95 percent of his available company stocks last Friday, an SEC filing reveals. In total 65,151 shares were sold off, valued at $38.7 million. The remaining 2,988 shares were worth $1.8 million at the close of Friday trading.
Motorola Mobility has posted its first-quarter financial disclosures, pointing to an $86 million loss despite a slight uptick in revenue. The numbers compare to a $80 million loss in the previous quarter, and an $81 million loss for the same quarter last year.
Apple served as the example for a wider industry issue once more on Saturday through an investigation on Saturday. The iPhone maker was already known to be offshoring most of its income, but it's now known by the New York Times to have divisions across Europe, the British Virgin Islands, and elsewhere outside of the US to minimize how much it's taxed. Within the US itself, it has taken advantage of Nevada's absence of corporate tax to boost some of the gains that come into the US.
The patent struggle between Yahoo and Facebook took another turn today, with Yahoo adding two more patents to its list of alleged infringements by Facebook. The move, which brings the total number of alleged Facebook infringements to 12, came in response to Facebook's own countersuit against Yahoo, in which the social network claimed that Yahoo had infringed on 10 Facebook patents.
In their annual meeting today, AT&T's stockholders shot down a proposal that would have seen the telecom giant commit to the principles of net neutrality. The proposal, made possible by an SEC regulation requiring that carriers allow shareholders to vote on the issue, was defeated 94 percent to six percent.
Nokia faced its third credit rating cut in a month on Friday in signs of a further confidence problem. Standard & Poor dropped Nokia's rating to junk status based on a shortfall in cash strength. While its existing cash was a "positive factor," the firm said, it expected the phone designer's cash to drop from a predicted 4.9 billion euros ($6.5 billion) to no more than four million euros ($5.3 billion).
The iPhone continues to be the key for growth and profits with cellphone carriers in Japan, as third-ranked provider Softbank Corporation posted a 65.4 percent increase in profits for its fiscal year, which ended in March. The company credited growing subscriber numbers and iPhone 4S demand as factors, despite the emergence of rival KDDI Corporation as an alternative provider of iPhones. The company had spent heavily on promotions to avoid having customers change to KDDI.
In a possible glimpse into Apple's planning, TriQuint Semiconductor in Oregon (which has supplied chips for several versions of the iPhone) has warned investors that sales some of it older chips will fall at least 19 percent in the current quarter, but that the revenue drop was likely to be only temporary. Although CEO Ralph Quinsey did not specifically name Apple, it is well-known that the iPhone maker is TriQuint's largest single customer, reports The Oregonian.
Amazon on Thursday recorded a significant hit to its profit for the first quarter of 2012. Its net income dropped 35 percent from year-to-year, to $130 million. Net sales were still up 34 percent to almost $13.2 billion, setting a new high.
Several financial analysts have raised their estimates for Apple following the company's second-quarter results. Among these is Canaccord Genuity's Michael Walkley, who has raised his target for Apple stock from $740 to $775. "While our checks indicate slowing iPhone sales ahead of the iPhone 5 launch, we believe very strong international iPhone sales position Apple for very strong sales of an LTE iPhone 5 in the December quarter and beyond to drive strong F2013 earnings growth," he writes in a new memo.
Apple's new senior VP of retail, John Browett, has been granted 100,000 shares in company stock. Browett began his job on April 20th, the date the shares were granted as well. A Securities and Exchange Commission filing shows that the stock is set to vest over the course of five years: 5,000 shares will be available on October 20th, followed by another 15,000 on the first anniversary of his employment, and repeating increments of 20,000 on each subsequent anniversary.
The Asia-Pacific region and China specifically were called out several times in today's earnings call with analysts. CEO Tim Cook was unusually candid in breaking out some China-specific numbers, noting that of the $10.15 billion in Asia-Pacific sales in the company's second fiscal quarter, China alone accounted for $7.9 billion, a tripling of sales on a year-over-year basis. Cook also said Apple was seeing a "halo effect" that was increasing Mac sales in the region.
In a conference call following Apple's fiscal Q2 financial disclosures, CEO Tim Cook downplayed talk of declining subsidies for the iPhone. The executive argued that iPhone subsidies are "not large" relative to the sum of service subscriptions spread across a 24-month period, while the iPhone still has a number of "distinct advantages" over competing products.
To go along with its core press announcement, Apple has posted a more detailed breakdown of its Q2 financial results. Regionally, revenue was up 41 percent year-over-year in the Americas to $13.182 billion, while Europe rose 46 percent to $8.807 billion, and Japan was up 91 percent to $2.645 billion. The Asia Pacific region -- including China -- grew the fastest, leaping ahead 114 percent to $10.153 billion. Worldwide, retail was up 38 percent to $4.399 billion.
Despite lackluster expectations from some analysts, Apple today confirmed that it has added $12.5 billion to its cash balance for its second fiscal quarter that ended in March. The company now has more than $110.2 billion in cash on hand, up from $97.6 billion at the end of the December quarter.
Apple is holding the conference call for its fiscal second quarter results. The company is expected to talk more about its very high iPhone sales as well as provide context for more modest iPad and Mac results. Check our live coverage page for details from the call as they emerge, starting from 5PM Eastern.
Apple has announced the results of fiscal second quarter, which ended in March. Revenue pushed ahead to $39.2 billion, generating $11.6 billion in net profits, or $12.30 in earnings per share; the figures compare against Q2 2011 totals of $24.7 billion, $6 billion, and $6.40, respectively. Gross margin grew from 41.14 percent to 47.4 percent year-over-year, and Apple notes that international sales in the recent quarter represented 64 percent of revenue.
US carriers are unlikely to push back on iPhone subsidies for another 18 to 24 months, at least, says CLSA analyst Avi Silver. He estimates that about $19 billion of Apple's FY2011 revenue came from carrier subsidies, 46 percent of that being derived from US companies. Any lowering of subsidies would therefore have a major impact on Apple's profits, which has led some analysts to be skeptical of or even issue downgrades on Apple stock.
Facebook just released a new S1 for the first quarter of 2012, showing a drop in profits and operating income. The filing also revealed the total number of active monthly users, as well as the full costs of the social giant's acquisition of image sharing service Instagram.
Apple will probably discontinue the 17-inch MacBook Pro sometime this year, argues KGI Securities analyst Ming-Chi Kuo. "While adding new products, Apple is likely to stop making the 17" MacBook Pro this year due to falling shipments, in order to maintain a lean product line strategy," he writes in a new memo. He estimates that Apple sold about 3.1 million MacBooks in the March quarter, but almost 1.5 million of these are expected to be 13-inch MacBook Pros, sitting ahead of 1.1 million MacBook Airs. 15-inch Pros could represent just 500,000 units, but 17-inch systems may account for as little as 50,000 units.
Two more analysts have raised forecasts for Apple ahead of the company's Q2 results, due to be announced April 24th. Sterne Agee's Shaw Wu says that based on "supply chain checks," he's expecting "a sizeable EPS (earnings per share) beat based on iPhone and iPad strength despite Macs likely coming in a little light." The problem with Macs is said to be linked to a "drawdown in inventory on some models indicating there could be a pending product refresh," plus "minor" sales cannibalization from the iPad.
AMD today announced revenues for the first quarter of 2012, and the semiconductor maker posted a sizable net loss. Despite a net loss of $590 million dollars, AMD representatives expressed optimism about the company's future performance.
Analysts at Citigroup and Piper Jaffray helped trigger stock market jitters on Thursday over the implications of LTE chip supply as it relates to Apple. Following Qualcomm statements after its quarterly results that there was a supply shortage of its 28 nanometer chips made at TSMC, Citi's Glen Yeung and Piper's Gene Munster both suggested that was a direct sign of Apple choosing a 28nm MSM9615 cellular chipset for its next iPhone. To Yeung, a ramp down in existing 45nm parts combined with the shortage was a sign Apple was switching production and lowering orders of older hardware as it got ready to produce the new.
Qualcomm Incorporated released its financial results for the second quarter of fiscal 2012 today, with numbers showing substantial revenue growth for yet another consecutive quarter. The mobile chip and network gear maker noted record revenue and earnings per share growth, driven by 3G- and 4G-enabled devices.
Square is looking to secure a fresh injection of venture capital funding, AllThingsD reports, and has set its valuation sights pretty high for this round. The payment processing company is eyeing a $4 billion valuation, which would amount to a quadrupling of its previous valuation from less than a year ago.
Goldman Sachs analyst Bill Shope has raised his price target for Apple stock from $700 to $750, recommending a buy ahead of the company's Q2 results, due to be released next week. He suggests that the quarter will be another impressive one for Apple, and largely dismisses several concerns about Apple profits. He argues for instance that most carriers are unlikely to cut iPhone subsidies, since they're trying to migrate people from "feature" phones to smartphones, and don't want to lose their share of the iPhone market.
Speaking on an analyst conference call covering his first full quarter as CEO, Yahoo head Scott Thompson said that the company will focus on the services it does "really well," and may close or transition other services that are less popular. Saying "Yahoo has been doing way too much for too long," Thompson plans to shutter or consolidate some 50 Yahoo properties and will focus on the company's mail, financial site and sports coverage.
HTC has moved to appoint a new CFO after his predecessor was ousted from the position after just one year. Highlighting troubles at the Taiwanese handset manufacturer, Winston Yung has been moved into a undefined role in corporate development and has been replaced by Chia-Lin Chang. Yung was behind the somewhat controversial decision to purchase Beats Audio for $300 milllion, which has failed to raise the image of the brand or attract customers.
New numbers of analyst firm NPD for March added to previous data for the quarter suggests that US Mac sales will be flat or low in terms of year-over-year growth, missing analyst's estimates, warned Piper Jaffray's Gene Munster. Foreign sales, already expected to offset the slow growth in North America as buyers wait for anticipated notebook and iMac refreshes, may not hit the 14 percent year-over-year consensus targets analysts expect.
A trio of sources leaked Monday that RIM has been looking at hiring banks to advise it on "strategic options." The Bloomberg tips had the BlackBerry designer looking for one Canadian and one international bank. The negotiation was explained more as evaluative than a definitive direction.
Google beat expectations for its results on Thursday and simultaneously set out plans to create a new kind of stock to keep its management in place. The company saw its mostly ad-based revenue up 24 percent, to nearly $10.7 billion, and its net profit even higher, up 61 percent to $2.89 billion. While the company didn't delve into specific factors, it was thriving both on its core business and on the "momentum from the big bets" on Android, Chrome, and YouTube, CEO Larry Page said.
British tabloid newspaper The Daily Mail has accused several leading technology companies, including Apple, of dodging their fair share of UK taxes by setting up operations only in parts of that nation that offer lower-than-average tax rates. The charges were triggered by an investigation of online retailer Amazon, which switched its European headquarters to Luxembourg and ended up not paying a penny in British corporation tax for the past two years.
