1 Apple’s revenue drops first time in 13 years (Sam
Thielman, Rupert Neate & Alex Hern in The Guardian) Apple shares dropped after
the company reported a nearly 13% fall in quarterly sales, the first time
revenue at the world’s most valuable publicly traded company has declined in 13
years.
Revenue was predicted by Apple itself to fall
between $50bn and $53bn – it came in on the low end of that range, with a final
tally of $50.6bn, a 13% drop. Apple said the decline would continue, predicting
revenue between $41bn and $43bn for the June quarter.
The company had warned investors to brace for
impact. The iPhone accounts for nearly 2/3 of Apple’s revenue and the company
sold 16% fewer iPhones than it had during the same period in 2015 and made 18%
less money from them. The total tally for the device was $32.9bn from 51.2m
phones sold – the year previous Apple brought in $40.3bn from 61.2m phones.
Much of the falloff was attributable to the
struggling Chinese economy. The nation’s consumer technology sector is in flux,
as is the yuan. Still the second-largest market in the world for Apple products
behind the US, the Chinese segment of Apple’s dismal report declined by more
than a quarter of its value.
It is the first time Apple’s sales have fallen since
2003. Back then, the iPhone didn’t exist. Apple was still selling Power Mac
computers and had sold only 600,000 iPods. It was the year iTunes was launched,
which revolutionized the music business. The iPhone came out in 2007, followed
by the iPad, and both were constantly updated, sending the company’s sales to
ever higher levels.
But Apple does have big projects underway. It’s
probably the worst-kept secret in Silicon Valley that the company is working on
an electric car, poaching engineers from Tesla and scouting for test locations
in California. And it’s also been hiring engineers and filing patents that also
suggest it’s working on a virtual reality device of some sort.
In the meantime it is still piling up cash. It now
has a cash mountain of $233bn; more than all the foreign currency reserves
across the world and more than the Czech Republic, Peru and New Zealand make in
gross domestic product (GDP) a year.
2 Twitter earnings drop, shares plunge (BBC) Twitter's
latest earnings results have disappointed investors, coming in below
expectations as the firm struggles with weak growth in users and advertising. Shares
in Twitter plunged 13.6% after the results were out.
Twitter had 310 million monthly users in the first
quarter while revenue was $594.5m, which missed analyst expectations. The
company has for years struggled to generate profits from its large base of
users. Twitter's revenue forecast for the current quarter was given as between
$590m and $610m, also short of what investors had been hoping for.
To boost its stagnant user growth, Twitter has over
the past months introduced a new user interface and emphasized its live video
offerings. Yet with Facebook launching a similar product, Facebook Live,
Twitter still has to prove that its turnaround plan will work.
3 Power crisis forces two-day work week in Venezuela
(San Francisco Chronicle) Venezuela's public employees will work only on Monday
and Tuesday as the country grapples with an electricity crisis. President
Nicolas Maduro announced that the government was slashing working hours for at
least two weeks in a bid to save energy.
He said the water level behind the nation's largest
dam has fallen to near its minimum operating level thanks to a severe drought.
Experts say lack of planning and maintenance is also to blame. The country's
socialist administration already gave nearly 3 million public workers Fridays
off earlier this month, and initiated daily four-hour blackouts around the
country.
The government is now extending the Friday holidays
to grade school teachers, though it appears employees of public hospitals and
state-run supermarkets will still have to work. Venezuelans reacted with
disbelief to the news that most public workers would hardly be going into the
office.
Workers will be paid for the days they're sent home.
Some have been using their Fridays off to wait in lines to buy groceries and
other goods. Others have been going home to watch TV and run the air
conditioning, leading critics to say the furlough is not an effective
energy-saving measure.
Power outages have been a chronic problem in this
oil country. Maduro's predecessor President Hugo Chavez promised to solve the
problem in 2010, but little has improved.
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