Despite Low Sales, iPhone SE Demand is Strong

Posted by Kirhat | Tuesday, May 03, 2016 | | 0 comments »

iPhone SE
Despite the declining iPhone sales, Apple is confident that they have found a gem with iPhone SE.

In March, Apple released the smaller, 4-inch-screen phone featuring much of the company's latest technology. Although sales of the phone were not captured in the second quarter, the device is off to a strong start, particularly in emerging markets, Apple Chief Financial Officer Luca Maestri told Reuters.

"The situation right now around the world is that we are supply-constrained," he said. "The demand has been very, very strong."

Although Apple's revenue in Greater China fell 26 percent from the year-ago quarter, Maestri stressed that the company was "extremely optimistic" about China. "We continue to make a lot of investment there," he said.

Chief Executive Tim Cook said that mainland China sales were down only 7 percent in constant currency, attributing much of the Greater China drop to Hong Kong, where strength in the local dollar, which is pegged to U.S. currency, deterred tourist shopping.

The company did not comment on prospects for its iBooks Stores and iTunes Movie service, which were shut down a few days ago in China.

Apple forecast third-quarter revenue of US$ 41 billion to US$ 43 billion, short of the Wall Street consensus of US$ 47.3 billion.

Apple also said it was raising its capital return program by US$ 50 billion through a US$ 35 billion increase in its share buyback authorization and a 10 percent rise in the quarterly dividend.

The drop in after-hours shares wipes out roughly US$ 46 billion in market capitalization, roughly the value of heavy equipment maker Caterpillar Inc .

In reaction to Apple's results, shares of its suppliers Skyworks Solutions , Qorvo, Broadcom and NXP Semiconductors all fell 2 percent or more last 26 April.

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Apple Sympathizes with Employee Found Dead

Posted by Kirhat | Monday, May 02, 2016 | | 0 comments »

Apple Office
The Santa Clara County Sheriff's Office is investigating after a dead body and firearm were found in a conference room at Apple's Cupertino, California, headquarters last 27 April. The Santa Clara County Medical Examiner has now officially ruled the death a suicide and identified the Apple employee as 25-year-old Edward Mackowiak, according to The Mercury News.

It is not certain what is Mackowiak’s role in the company, but Apple did offer a statement, as reported by Matt Keller, a local ABC reporter on the scene.

"We are heartbroken by the tragic loss of a young and talented coworker," the statement reads. "Our thoughts and deepest sympathies go out to his family and friends, including the many people he worked with here at Apple."

The campus at 1 Infinite Loop remains open, and officials said there was no additional risk.

"Through further investigation, they determined there [were] no other individuals involved and they believe it was an isolated incident. There was no one else on campus or in the public at risk," Sgt. Andrea Urena of the Santa Clara County Sheriff's Office said, according to NBC Bay Area.

Law enforcement sources told TMZ that a call was placed at 8:38 A.M. PT on 27 April, reporting a "possible suicide." The dispatch call alluded to an argument on campus involving a female employee, who sustained a head injury — possibly from a gunshot wound — while being escorted out by security. It was not immediately clear what happened to the female employee mentioned in that call. The Santa Clara County Fire Department was also called to the scene initially, but never actually entered the campus.

The news comes a day after Apple announced its first year-over-year revenue decline in 13 years. Citing falling iPhone demand and slowing Mac sales, the consumer electronics giant announced revenues for the second quarter of US$ 50.6 billion, a 13 percent decline from last year. The quarter's net income also went down from last year's US$ 13.6 billion to US$ 10.5 billion, which comes out to US$ 1.90 a share. The company’s gross margin dipped from 2015's 40.8 percent, to 39.4 percent.

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Apple Is Struggling With Low Sales

Posted by Kirhat | Saturday, April 30, 2016 | | 0 comments »

Apple Store
After 13 years, Apple posted its first-ever decline in iPhone sales and its first revenue drop as the company credited with inventing the smartphone struggles with an increasingly saturated market.

The company's sales dropped by more than a quarter in China, its most important market after the United States, and it also forecast another disappointing quarter for global revenues.

Reports last 26 April revealed that Apple shares fell about 8 percent, dropping below US$ 100 for the first time since February. A hike in Apple's share buyback and dividend as well as bumper revenue from services failed to mollify investors.

Apple's results followed disappointing quarterly reports from Microsoft Corp and Google-owner Alphabet Inc , and microblog Twitter also on Tuesday reported results that missed expectations.

Apple said it sold 51.2 million iPhones in its second fiscal quarter, down from 61.2 million in the same quarter a year ago but above analysts' estimates of about 50 million devices.

While Apple executives had predicted iPhone sales would decline this quarter, they must reassure investors that the drop represents a momentary roadblock, rather than a permanent shift for the product that fuelled its meteoric rise.

After years of blockbuster sales, many investors fear the iPhone has reached saturation, spelling the end for Apple's exponential growth.

"Apple needs to come up with a radical new innovation or product rather than just the current incremental improvements to existing products. This is the only way in which it will reinvigorate sales growth," said Neil Saunders, chief executive of research firm Conlumino.

Apple Chief Financial Officer Luca Maestri told Reuters that the success of the iPhone 6 a year earlier had set a difficult bar to beat in the second quarter. "The iPhone 6 is an anomaly," he said.

But Chief Executive Tim Cook told analysts that the smartphone market was not growing, reinforcing wider concerns of saturation.

Cook also conceded that the iPhone 6s was driving customers to replace phones at a much lower rate than the 6. "I don't mean just a hair lower; it's a lot lower," he said. "If we'd had the same rate on 6s as 6, it would be time for a huge party."

He pointed to the services division, which includes Apple Music and the App Store, as a bright spot. Its revenue grew 20 percent to US$ 6 billion and surpassed iMac and iPad sales.

Cook also hinted that Apple had more gadgets to come.

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"Houston, Apple iPhone Has a Problem"

Posted by Kirhat | Friday, April 29, 2016 | | 0 comments »

iPhone Problem
Apple's biggest problem right now about the iPhone is not its specs, design or supply. The latest flagship product from Apple is just not measuring up.

Last 26 April, Apple announced that sales fell this quarter year-over-year for the first time in 13 years as the technology giant sold fewer iPhones than during the same period in 2015. The US$ 8 billion sales decline happened all around the world, but especially in China and the United States. Apple shares fell more than 8 percent after hours on the news.

What is odd is that by some metrics nobody expects Apple to be shrinking. On Apple's earnings call, CEO Tim Cook said the company set a record for the largest number of switchers from Android to iPhone over the last six months. Stealing market share is normally a good thing.

But many of the biggest smartphone markets are fairly saturated with iPhones already, which means now Apple needs to convince its past customers to upgrade. And they aren’t doing that as frequently. Cook said the iPhone 6s hasn’t inspired upgrades the way the iPhone 6 did when it came out in late 2014.

"If you compare to the 5s, the upgrade rate is slightly higher, with more people upgrading in a similar time period, at a higher rate," he said. "But if you compare to the 6, you arrive at the opposite conclusion."

Cook continued, calling the upgrade rate for the 6s "not a hair lower, it's a lot lower" than that of the 6. "If we had the same rate of success as we did on the 6, it would be time for a huge party, it would be a big difference," he said.

As Cook explains, Apple is partially the victim of its own success, as the larger iPhone 6 was a global blockbuster on an almost unparalleled scale. But it is also a victim of its own every-other-year major iPhone release cycle. The 6s had the exact same dimensions and design as the 6, and few major feature upgrades. Many iPhone users who bought the 6 or didn’t think it was a big enough upgrade from their iPhone 4s, 5, or 5s were given little reason to upgrade to the 6s.

And things seem to be getting worse for Apple, not better. At least in the 1st quarter the company still saw iPhone sales growth in China–but that's over for now. Cook said the company "no longer has the wind at our back" in the world’s largest smartphone market.

Unless the new iPhone SE can revive sales growth, Apple could be in for a long slump until the fall when they can bet on the iPhone 7 to rescue them.

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When Will We See the Apple Car?

Posted by Kirhat | Thursday, April 28, 2016 | | 0 comments »

Apple Car Concept
The Cupertino company may be working on an electric autonomous car, but not everyone is convinced the Apple Carr will see the light of day or reach the showroom floor. One analyst believes it will end up in a graveyard of never-launched products, just like the 65-inch Apple TV.

"I think that this is similar to the large screen television that Apple built but never launched albeit on a larger scale," said Richard Windsor, a tech analyst at Edison Investment Research.

While Apple reportedly scrapped plans for a 55-inch to 65-inch television after failing to find any must-have features that set it apart from the competition, according to The Wall Street Journal, the car is facing much bigger problems, said Windsor.

Apple is "finding it much harder than expected" to build a car, as it pivots into an area of business with huge barriers to entry, mountains of regulatory red tape and no clear path to profitability, he said.

Apple hired a number of auto-industry veterans over the last few years, such as Doug Betts, previously of Fiat Chrysler Automobiles NV, and has reportedly hired hundreds of people to focus on the internal car project, code-named Titan. But Windsor said hiring talent to build a car only takes a company so far without a clear path to the product category’s profitability.

Apple may have billions of dollars of spendable cash, but being a newcomer in the auto industry is never easy, as Tesla Motors has shown with its 11 straight quarterly losses. The pricey parts of automobile also tend to weigh on margins more than Apple’s more traditional consumer electronics. Apple, which reported a 35 percent year-over-year increase in profit to US$ 53.4 billion in fiscal 2015, tends to have 40 percent or better profit margins on its phones, tablets and computers, while Windsor said 40 percent gross margins on cars are "hopelessly unobtainable."

"I think that this would be catastrophic for the valuation of the company," he said.

The analyst doesn't doubt the importance of the autonomous car market, and why the technology needed to support the industry’s growth and the treasure trove of data that will ultimately be produced from them is so attractive to Apple and other tech companies, such as Alphabet. But from an economic standpoint, he thinks it makes more sense for Apple to focus on an infotainment unit, which it could sell as a service with more reliable returns, rather than building another piece of hardware. Other analysts have also recently expressed the importance of software for Apple long term, as the smartphone market grows increasingly saturated.

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Apple Enhanced iPhone Security Details After FBI Spat

Posted by Kirhat | Wednesday, April 27, 2016 | | 0 comments »

Secure iPhone
In a press briefing last 15 April, Apple described how security works on the iPhone and iOS. The meeting, which was often technical, shed insights into its broader approach to security.

Although the meeting wasn't specifically about the battles the company has had with the FBI and parts of the U.S. government – including cases in San Bernardino and Brooklyn – that conflict was still the elephant in the room.

Still, Apple insists its goal with iOS and iPhone security is not about protecting users from the government, it's about protecting users from hackers.

Senior Apple engineers said that although the security has been a big part of how the company approaches its design for the last two decades, it has become even more important in the last decade because of the iPhone.

The iPhone, more than any other product, is a place where customers place their most important and private information. Everything from identity information to health information is stored on the device and Apple engineers say that the company feels its imperative to protect that information from hackers trying to break in.

At the meeting, senior Apple engineers, who declined to offer individual comment, discussed the company's approach to security.

The fact that hackers are the real threat vector, not the government, was a theme in the briefing.

Describing security as a process and not a destination, senior Apple engineers were quick to assert that there is no such thing as 100% security, but that the company is focused on building its system from the ground up to be as secure as possible.

The engineers also stressed that security is dynamic, not static. And because the situation is always changing, security can never be seen as complete.

For Apple, it feels that one of its core advantages is that it controls the whole stack of hardware and software. Moreover, Apple has designed security into its products from the silicon up.

Calling Apple "the most effective security organization in the world," senior Apple engineers repeatedly emphasized that the entire Apple ecosystem was designed with security in mind.

Because Apple designs its own chips and its own operating system, it is in a unique position in the industry when it comes to hardware/software integration.

In other words, hardware embedded into the chip on the phone checks the software before it boots to make sure it is secure and actually signed by Apple. This is done as a way to prevent hackers from taking over the device and putting another rogue version of an operating system on a device.

Security Details

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