Business, Financial & Legal - Page 147

Even though Samsung sold close to double the smartphones that Apple did last quarter, with 50 million sold, which is the largest number of units ever shipped by a single vendor in a single quarter, Apple are still absolutely kicking the asses of the competition when it comes to the industry's operating profits.

Apple have much higher gross margins on their iPhone and iPad's, which completely eclipses its rivals in both revenue, and operating profits. Apple only shipped around 6% of the industry's smartphones and tablets in Q2, but they took a surprising 43% of the industry's revenue, according to Raymond James analyst Tavis McCourt. Apple also generated an absolutely huge 77% of the industry's operating profits, even in a seasonally weak period for iPhone sales.

So, now we find ourselves in a position of weirdness with competitor Samsung. The Korean-based company outsold Apple's ever-so-popular iPhone two-to-one, and still couldn't touch Apple's insane grab of industry operating profits. But, things can change quickly, and all it takes is a single release from a company (a new, surprising, 'magical' iPhone), or a constant stream of releases (Galaxy phones that continue to sell more and more) to turn things around.

Richard Schulze, founder of Best Buy, has offered to buy the retailer for roughly $8.5 billion, according to reports. Schulze resigned as chairman after ex-CEO Brian Dunn was investigated for "personal misconduct" issues, has offered to pay between $24 and $26 per share for Best Buy, which he hopes to make private.

Best Buy has confirmed that they have indeed received the proposal, and says it will be considering it in the near future. As of June, Schulze held over 20% of the company, and plans to put forward $1 billion from that stake into the proposed deal. The remaining $7.5 billion (or so) would come from "premier private-equity firms" who claim to have a "deep experience in retail", as well as debt financing.

While according to Minnesota corporate law, permission from company directors is required in order to form a group for a more complete offer, which is requested in Schulze's offer letter, and has no deadline set. There is reportedly a source close to the matter that says that Schulze entered into the negotiations for the board's permission in the last couple of weeks, but wasn't successful due to the board claiming that it wasn't a good time to go public.

It's been a roller coaster of emotion for users of the popular torrent and tracker site Demonoid. The site has been down for around a week now, and it would appear that the downtime is set to continue. The site was originally taken offline by a DDoS and users rejoiced when they heard that this was the case.

However, more bad news has hit users of the site. Out of Ukraine, word has come that the site has been shutdown by authorities as a gift for the United States government. The takedown was timed to coincide with the very first trip of Deputy Prime Minister Valery Khoroshkovsky to the United States where the topic was copyright infringement.

"Investigators have copied all the information from the servers Demonoid and sealed them," an anonymous ColoCall source confirmed. "Some equipment was not seized, but now it does not work, and we were forced to terminate the agreement with the site." It seems that this week has been a bad week for the site.

The late Steve Jobs famously said that Apple did "no market research", so Apple never really knew what consumers want. But, it looks as though Apple were lying through their teeth, as new documents have been bought up during the Apple vs. Samsung patent lawsuit.

Network World's Yoni Heisler writes that Apple is positively freaking out that the possibility of their extensive market research surveys of iPhone and iPad users could be made public. That sentence should send shivers down Apple's spine, as it is considered the 'secret sauce' to attracting, and keeping loyal Apple users.

Apple's Bible could be thrown in for evidence, as the Cupertino-based company lost their bid to keep the market research, with Samsung now able to use it as evidence for their trial. Heisler also reports he found a declaration to the court that had been submitted by Apple's Vice President of Product Marketing, Greg Joswiak, explaining why Apple's customer surveys should remain a secret:

All it took was 45 minutes for financial services firm Knight Capital to lose an astonishing $440 million on Wednesday, the money was lost during a newly-installed trading piece of software was installed, and it went wrong, very wrong.

$440 million represents nearly double the company's second quarter revenue, and could be enough to see the firm head into an unescapable downward spiral. Automated high-speed trading on the stock market seems to have caused the company this massive problem, but how does it seem to happen so easily? Well, according to the New York Times, Knight Capital "accidentally sold all of the stocks it bought on Wednesday morning":

What a colossal mistake to happen by accident, and this isn't the first time something like this has happened causing massive losses on the stock market. Knight Capital also took a hit during the NASDAQ Facebook IPO problems, too. Things aren't looking too good for the firm.

Research firm Strategy Analytics have some interesting numbers out, where it shows that Apple still have complete and utter dominance when it comes to the tablet market, with 68% of shipments secured by the Cupertino-based company for Q2 2012.

Google's Android platform scooped up 29% of the remaining share. IDC have also released their own estimates of tablet shipments for the same quarter, with their estimates similar to those from Strategy Analytics, with estimates of 25 million tablets shipped, and 68% share for Apple's iPad. IDC breaks these numbers down by manufacturer, instead of platform.

According to IDC's report, Samsung is sitting comfortably at second position, behind Apple. But, even with a very strong 117.6% year-over-year shipment growth, Samsung still can't touch Apple, being outsold at a margin of 7-to-1. IDC says:

Microsoft have just announced that they've inked an intellectual property (IP) deal with Honeywell, adding them to their ever-growing list of third parties who have to pay to use its software. Microsoft said in a statement:

This deal includes mentions of Chrome OS and Android, and now Microsoft has been quite effective in bringing Android OEMs into agreements that see the company collecting fees. It's not known whether all companies pay a per-unit cost, but at the end of the day they're having to hand over cash to Microsoft, or grab the closest lawyer.

Microsoft have recently talked of having over 70% of the Android OEM smartphone market as part of their licensing deal network, and now they've just added Honeywell to this list, and not so long ago, Pegatron. This deal stands out as it seems preemptive, as Honeywell only launched their first Android-based phone just hours ago.

I stumbled across some interesting news today, with EA's financial results for the first quarter of this year, which have some interesting facts for the games industry. EA's report is broken down into platforms, PC, Xbox 360 and PlayStation 3.

EA made $292 million from the Xbox 360, $276 million from the PC and $267 million from the PS3. This means that as one of the world's biggest publishers, EA made more money on the PC than they did from the PlayStation 3, which to me, is quite surprising. EA's surge in business for the PC is looking to be attributed from digital sales.

EA has made $342 million from digital sales, up considerably from $232 million last year. Physical sales represent $592 million, dropping from $647 million last year. So, we're seeing that more and more people are going digital, like myself, compared to buying physical copies of games. If this trend continues, we could see digital thrashing physical copies, and when (note that I'm not using the word if) this happens, we're going to see an interesting shift in the gaming world. This is coming from a company who has said that it's "inevitable" that they'll become a 100% digital company.

AMD has been losing talent left and right over the past year. December saw the loss of VP of strategy Patrick Moorhead and Product Director Carrell Killebrew, among others. Just last week week, AMD lost the person responsible for getting AMD GPUs into every single one of the current consoles to NVIDIA.

AMD hasn't been very competitive on the CPU front, and the GPU front seems to be falling behind NVIDIA. Bulldozer had lackluster performance and Piledriver improvements don't seem to be enough to put AMD back into direct competition with Intel. Enter Jim Keller.

Jim Keller worked at AMD between 1998 and 1999 where he led development of the K8 architecture, arguably AMD's biggest lead over Intel, and co-authored the x86-64 specification. Even though he was only there for a short time, he certainly left his mark on the company. His resume is even more impressive with the work he has been doing lately.

Facebook have not had a good time since their IPO launch, where they began trading at $38 per share. But at the close of Tuesday this week, shares were down another 6-percent, reaching just $21.71 per share. This represents a drop of 43-percent since the social networking site went public.

Even after Facebook's first ever earnings report as a public company was released, there are still concerns over the social networking sites growth, which just don't seem to be going away. Investors had hoped to have seen more progress in terms of the user growth, and how the company is capitalizing on the rapid increase of mobile usage. Investors wanted Facebook to "show confidence they could grow the company, and they didn't", said Francis Gaskins of IPODesktop.com.

But, are we at the bottom of the barrel yet? It appears not. Come August 16, just a mere 91 days after the IPO, insiders such as company officers, directors and employees, can sell a whopping 268 million shares of stock. Between 91 and 181 days after the IPO, insiders can sell an additional 137 million shares. If these shares are to see any move, it could spell quite the disaster for Facebook, and drive their share price much, much lower.

The Apple vs. Samsung trial is underway at the moment, and it looks like Samsung's legal team have made a pretty bad move, with the team in trouble with Southern District Court Judge Lucy Koh. Samsung have been going on about the 'Sony-style' design mockups this week, and this is what has landed them in trouble.

There were some mockups from Apple designer Shin Nishibori that were designed in order to show how Sony's design sensibilities could be melded with Apple's, in order to create a phone. The design was said by Samsung to exemplify that Apple were working from another company's designs when they were creating the iPhone, which is exactly what Apple are accusing Samsung of.

Apple then pulled out a prototype predating Nishibori's design that dated back to 2005, where they argued that Sony designs were just a riff on what it had done before. At this point, it had negated Samsung's point, in the eyes of Judge Koh. Koh then ruled that Samsung could not present evidence related to these 'Sony-style' designs, or another prototype design that Samsung says it was working on in 2006.

Yahoo have been in the news quite a lot lately, for all the right reasons, with ex-Google exec Marissa Mayer appointed the new CEO and president of the company. But, interim CEO, Ross Levinsohn has confirmed that he's leaving the company after not being named for the permanent position.

Levinsohn had allegedly been telling candidates for senior positions that he would be the next CEO, and according to reports, Yahoo employees were hoping that he would stay on with the company in some capacity, as well as help guide the company itself. But, over the weekend, Levinsohn e-mailed, saying:

Levinsohn doesn't leave empty handed, as he will receive $5 million in vested stock options, as well as 175,000 restricted stock units. He'll also receive a one-time payment of $1.4 million, which is in accordance with his 2010 offer letter, and 2011 severance agreement.

Research firm Strategy Analytics has some new numbers for everyone to peer at, with the US Android handset sales dropping in Q2, but iOS sales went up. Overall, smartphone shipments for all manufacturers fell a little, by 5-percent to 23.8 million, compared to 25.2 million from the same quarter last year.

These changes in numbers are attributed to a combination of things, such as a volatile economy, and changes in upgrade policies by major carriers. Android sales in Q2 2011 were 15.3 million, taking up 60.6-percent of the market. This year, with the launch of flagship models such as Samsung's Galaxy S III, Android-based phones managed just 13.4 million sales, with 56.3-percent of the market, representing a drop of almost two million handsets over the period.

iOS was the only platform to not lose its footing, where it rose by nearly two million units, the same number Android lost, to reach 7.9 million units sold. It also increased Apple's marketshare from 23.2- to 33.2-percent, even with rumors of a new iPhone coming in the next few months. BlackBerry OS lost a million sales or so, and shrank to 1.6 million, or just 6.5-percent of the current market. This is believed to be the lowest market share RIM has ever had in recent history.

Seagate have been rumored to be looking at scooping up an SSD maker, where it piled up into a RumorTT post regarding Seagate acquiring OCZ. The news flared up again this week with tech blog side the Bright Side of News reporting that the deal between the companies was "done". But, it appears that it is not actually done and that Seagate might not acquire OCZ at all, at least, not right now.

Since the BSN post, OCZ shares jumped up 30-percent on Friday, and up 66-percent since mid-July all based on speculation that Seagate were to acquire the company. But, it looks like those highs are over, and OCZ's share prices are falling back down to more reasonable levels. OCZ shares topped at $7.60, and have now dropped to $6.36. On Thursday, the prices were hovering at around $5.40 a share.

Then we have a Reuters article who quoted Seagate CFO Pat O'Malley, who said that the company would be interested in acquiring an SSD maker that has a "significant" share of the enterprise market, where he adds:

Apple acquired Authentic, who is a leading provider of mobile and network security for the tidy sum of $356 million last week. Under the deal, Authentic are set to become a wholly owned subsidiary of Apple.

Shares of Authentic closed at $5.07 on the 27th of July, with Apple paying a 58-percent premium on this valuation at $8 per share. This means that share holders of Authentic would've had a nice surprise for the weekend just gone. Authentic are best known for producing fingerprint sensors, NFC chips and security software for mobiles.

Authentic has some big customers in their pockets, such as Samsung, HP, Fujitsu, Dell and Lenovo. Apple seem to have secured a firm which deals in security, after the many many stories of their OS being not as secure as they're previously stated. We should hopefully see the effects of Apple's latest acquisition in the coming years.

AOL reported their Q2 earnings report, seeing revenues of $531 million. This makes it AOL's lowest total revenue decline in seven years, with a 2-percent year-on-year decrease.

AOL's legacy income, such as mobile carrier revenues and subscriptions continued to fall, but it was offset by growth in international display advertising and third-party network revenues. Operating income was boosted by the $96 million AOL made from licensing patents to Microsoft.

But, AOL have insisted that its EIBDA grew regardless of this deal with Microsoft, saying that "excluding those items, the remaining Q2 2012 Adjusted OIBDA of $94.6 million reflects an increase of $18 million year-over-year." AOL chairman and CEO, Tim Armstrong said:

Zynga didn't have high estimates from analysts, but the company didn't even meet those. The company releases their Q2 earnings report, which showed revenue of $332 million, and lost $22.8 million, or 3 cents per share. Analysts predicted Zynga would pull in 5 cents per share on revenue of $344 million.

Zynga have said they have 72 million daily active users, up from 59 million in the previous quarter, and 306 million monthly active users, up from 228 million. Bookings on the other hand, were $302 million, up 12-percent from the same time last year, but a sequential decline of around 9-percent from the previous quarter.

The company has now lowered its outlook going into the rest of 2012 based on delays in launching new games, a faster decline in existing web games due in part to a more challenging environment on the Facebook web platform, and reduced expectations for Draw Something." Zynga are projecting $1.15 billion to $1.225 billion in bookings for the remainder of 2012.

Birmingham City University students, get ready. Sony Computer Entertainment Europe has once again teamed up with that university to offer the chance to students to win a scholarship. The scholarship, if won, will see the student having half of the fees paid to attend the Gamer Camp Pro, which is a master's degree program with a gaming focus.

Furthermore, the students will then get a six-month placement in one of Sony's UK development studios. They'll even be paid for that, too! In order to have a chance to win, students must be signed up for Gamer Camp by August 9 and be automatically entered. The cheaper Nano version will work. Winners will be selected by interview from the initial pool of perspective candidates.

"We are delighted to offer PlayStation Academic Scholarships in partnership with Gamer Camp: Pro for the second year running." said SCEE's Dr. Maria Stukoff. "It's a great opportunity for the next generation of British videogame talent to acquire professional development skills before they embark into a competitive industry."

ARM Holdings, who supplies microchips to Apple for their iPhone and iPads, Samsung's Galaxy line of smart devices, and now Microsoft's Windows 8 devices, has reported strong earnings for Q2.

The company had reported $213 million in earnings, which beat analysts' estimates of $206 million. Net profits was up 48-percent to $61.2 million, compared to $41.3 million this time last year. Next quarter's profits should be even better, as the company has said they have a "record order backlog", but have warned that macroeconomic uncertainties may impact what happens in Q4.

ARM noted in a statement that "Macroeconomic uncertainty may impact consumer confidence, and some analysts have become less confident in the semiconductor industry outlook in the second half". ARM did note that they expect overall revenues for 2012 to be in line with market expectations. They are heading for full-year revenues of $860 million.

Apple has reported its third quarter earnings and sales numbers and they are pretty darn promising. In the last three months, Apple managed to push a large number of iDevices. The iPad fared the best with 17 million units sold, up from 11.8 million last quarter. The iPhone didn't do as well, but still managed an impressive 26 million.

The iPhone's 26 million was down from last quarters 35.1 million, but was up 28% from last year's Q3 numbers. These numbers confirm analysts expectations that the iPhone would see a decline while the iPad would see significant growth. The decrease in iPhone sales is a bit troublesome for the company as that is where the majority of their revenue and profit are.

The iPad managed an impressive 83% increase year-over-year and a 44% increase over the second quarter. iPod sales were down again and it appears to be quickly becoming a niche product as more and more users snap up smartphones and use them as an MP3 player. With 6.8 million sales, it most likely is still the most popular MP3/MP4 player on the market.