iPhone 6 helps Apple post largest profit in corporate history

Apple Inc quarterly results smashed Wall Street expectations with record sales of big-screen iPhones in the holiday shopping season and a 70 percent rise in China sales, powering the company to the largest profit in corporate history.

The company sold 74.5 million iPhones in its fiscal first quarter ended Dec. 27, while many analysts had expected fewer than 70 million. Revenue rose to $74.6 billion from $57.6 billion a year earlier.

Profit of $18 billion was the biggest ever reported by a public company, worldwide, according to S&P analyst Howard Silverblatt. Apple's cash pile is now $178 billion, enough to buy IBM or the equivalent to $556 for every American.

Apple Chief Executive Officer Tim Cook said the Cupertino, California-based company would release its next product, the Apple Watch, in April.

Shares rose about 5 percent to $114.90 in after-hours trade.

Daniel Morgan, senior portfolio manager at Apple-shareholder Synovus Trust Company in Atlanta, Georgia, said that the report was a good sign in a quarter where big tech companies such as IBM and Microsoft Corp have disappointed.

Apple Chief Financial Officer Luca Maestri told Reuters in an interview that the company did not sell more iPhones in China than the United States, despite some earlier predictions by research analysts.

But the big-screen iPhone 6 and 6 plus drove revenues in China were up 70 percent in the quarter from a year earlier. The company's success in the competitive Chinese market can be attributed to its partnership with China Mobile Ltd, the largest global mobile carrier, and the appeal of the larger screen size of the iPhone 6 and 6 Plus.

Maestri said he does not expect Apple to struggle because of China's slipping economic growth. "We haven't seen a slowdown," he added.

Maestri also said the company doubled iPhone sales in Singapore and Brazil.

Apple will reach 40 company stores in greater China by mid-2016, Maestri told analysts on a conference call.

Carolina Milanesi, an analyst with Kantar Worldpanel ComTech, also lauded a 14 percent rise in unit sales of Apple Macintosh computers and sales of older iPhone models.

Apple was well positioned for the current quarter in China, she added, which will include the Chinese New Year holiday and reflect Apple's attempts to sell through new channels.

Apple reported net profit of $18.02 billion, or $3.06 per diluted share, compared with $13.07 billion, or $2.07 per share, a year earlier. That topped expectations of $2.60 per share, according to Thomson Reuters I/B/E/S. Analysts had expected revenue of $67.69 billion.

Maestri said that Apple faced "a clear headwind" from the strong dollar but that it had included the challenge in its forecasts. Apple predicted revenue of $52 billion to $55 billion in its fiscal second quarter, compared with Wall Street's average target of $53.79 billion.

Cook said that the company's new mobile payment service, Apple Pay, which lets customer buy products from select merchants with their phones, was in its "first inning" and the company would consider adding new features as it looked at expanding outside the United States.

source: www.abs-cbnnews.com

43 days to Christmas: iPhone 6, 6 Plus in PH this week

Thinking of where you will spend your holiday bonus? Two of the most sought-after gadgets of 2014 will be available in the Philippines this week.

Both Globe and Smart are accepting pre-orders online for Apple’s newly launched iPhone 6 and iPhone 6 Plus, which will arrive in the country on November 14.

Apple launched the iPhone 6 featuring a 4.7-inch Retina HD display and the iPhone 6 Plus with a 5.5-inch display in the United States last September.

The company earlier said that the two gadgets will be available in more than 115 countries by the end of the year.

source: www.abs-cbnnews.com

Globe, Smart unveil iPhone 6 prices

MANILA – Ayala-led Globe Telecom and Smart Communications Inc. have unveiled pricing details for the Apple iPhone 6 and iPhone 6 Plus.

Globe said it is offering the 16-gigabyte iPhone 6 at P2,099 per month and the 16-GB iPhone 6 Plus at P2,299 per month under Plan 1299 for a period of 24 months.

The new smartphones are also offered to prepaid subscribers for P37,500 for the iPhone 6 for 16GB; P43,000 for the 64GB; and P48,500 for the 128GB.

The iPhone 6 Plus, on the other hand, is priced at P43,000 for the 16GB; P48,500 for the 64GB; and P54,000 for the 128GB.

Globe said iPhone Forever subscribers who are on their 13th to 24th will be allowed to trade-in or pay a cash out for the new iPhone 6 and iPhone 6 Plus.

Smart, meanwhile, announced that the iPhone 6 is available under a monthly plan of P1,799 for the 16GB, P2,049 for the 64GB, and P2,153 for the 128GB.

The iPhone 6 Plus is available for a monthly payment of P2,049 for the 16GB, P2,153 for the 64GB, and P2,345 for the 128GB under the iPhone Plan 999 for a 24-month contract.

The latest iPhone models are available under Smart’s iPhone Plan 1799, Data Plan 2000, and Data Plan 3000 with a corresponding cash out of P5,000 to as high as P26,300 for the iPhone 6 and P5,000 to as high as P30,900 for the iPhone 6 Plus.

Smart’s iPhone offers also come with free all-net texts, all-net calls plus consumable data every month which can be used for video and music streaming, file uploads, and downloads, and chatting.

“We know many Filipinos are keenly anticipating the arrival of the iPhone 6 and iPhone 6 Plus, and the good news is they can now get these bigger iPhones from the country’s biggest mobile network. Subscribers can enjoy surfing the Internet, taking photos, downloading apps or playing games on the new iPhones that are now powered by Smart’s expansive coverage nationwide,” said Smart postpaid marketing head Kathryn Carag.

Carag added that existing Smart subscribers can upgrade to the new iPhones through the Wipeout promo.

Subscribers of Globe and Smart can now pre-order the latest Apple smartphones, which is scheduled to be released in the Philippines on November 14.

Apple launched the iPhone 6 featuring a 4.7-inch Retina HD display and iPhone 6 Plus with a 5.5-inch display in September.

Apple earlier said the iPhone 6 and iPhone 6 Plus will be available in more than 115 countries by the end of the year.

source: www.abs-cbnnews.com

Reviews are in: Bigger iPhone handset hailed

Bigger is better and Apple Inc. has finally realized that and given iPhone users a product that may be low on novelty but high on improvements, reviewers wrote.

Most reviewers say that the iPhone 6 is the best smartphone available or "ever made," while the 5.5-inch iPhone 6 Plus has been described as a "phablet" that will give competition to Samsung Electronics Co. Ltd.'s Galaxy S line of "big" Android phones.

"I think it's a terrific phone. In my view, it's the best smartphone on the market, when you combine its hardware, all-new operating system, and the Apple ecosystem whose doors it opens," Walt Mossberg wrote of the 4.7-inch iPhone 6 in the tech blog Re/code.

Geoffrey Fowler, who reviewed the phones for the Wall Street Journal, said Apple has "successfully addressed its size deficiency."

Mossberg said the increase in the screen size is a "catch-up" feature. But it is seen as a welcome change by Fowler, who said the iPhone "felt stuck in a bygone era called 2012" before the launch of the bigger phones.

New York Times reviewer Molly Wood appreciated the new "thinner, flatter and more rounded shapes" of both the phones. But she pointed out that the sleek look comes at the cost of the phones feeling "slippery."

The improvements made to the operating system - the iOS 8 software, and that to the camera were given a thumbs up by reviewers across the board. However, most believed that Apple could have done more to enhance the battery life of the phones.

Joshua Topolski, who reviewed the phones for Bloomberg, said they were faster than their predecessors.

"Apple will tell you that these are the fastest mobile devices it's ever made, and it wouldn't be lying. These phones scream," Topolski wrote.

The new iPhone 6 goes on sale on Sept. 19 in the United States.

source: www.abs-cbnnews.com

Will Apple iPhone 6 screen snag delay launch in September?

IPhone 6 screen halted temporarily over the summer

TOKYO - Suppliers to Apple Inc are scrambling to get enough screens ready for the new iPhone 6 smartphone as the need to redesign a key component disrupted panel production ahead of next month's expected launch, supply chain sources said.

It's unclear whether the hiccup could delay the launch or limit the number of phones initially available to consumers, the sources said, as Apple readies larger-screen iPhones for the year-end shopping season amid market share loss to cheaper rivals.

But the issue highlights the risks and challenges that suppliers face to meet Apple's tough specifications, and comes on the heels of a separate screen technology problem, since resolved, in making thinner screens for the larger iPhone 6 model.

Cupertino, California-based Apple has scheduled a media event for Sept. 9, and many expect it to unveil the new iPhone 6 with both 4.7 inch (11.94 cm) and 5.5 inch (13.97 cm) screens - bigger than the 4-inch screen on the iPhone 5s and 5c.

Two supply chain sources said display panel production suffered a setback after the backlight that helps illuminate the screen had to be revised, putting screen assembly on hold for part of June and July. One said Apple, aiming for the thinnest phone possible, initially wanted to cut back to a single layer of backlight film, instead of the standard two layers, for the 4.7-inch screen, which went into mass production ahead of the 5.5-inch version.

But the new configuration was not bright enough and the backlight was sent back to the drawing board to fit in the extra layer, costing precious time and temporarily idling some screen assembly operations, the source said.

Output is now back on track and suppliers are working flat-out to make up for lost time, the supply chain sources added.

Japan Display Inc, Sharp Corp and South Korea's LG Display Co Ltd have been selected to make the iPhone 6 screens, the sources said.

Representatives for those three suppliers, and for Apple, declined to comment.

WIDER IMPACT
Apple is known to make tough demands on its parts suppliers for new iPhones and iPads as it competes to create designs, shapes, sizes and features to set it apart and command a premium price in a fiercely competitive gadget market.

This can cause glitches and delays, including screen problems that crimped supplies at last year's launch of a high-resolution version of Apple's iPad Mini.

It also highlights the danger for suppliers of depending too heavily on Apple for revenues, creating earnings volatility.

Earlier this month, Japan Display, said to be the lead supplier for the new iPhone panel, said orders for "a large customer" - which analysts said was Apple - arrived as expected, but shipments may be delayed in the July-September quarter.

Japan Display's reliance on Apple's cyclical business has spooked some investors. UBS Securities has forecast that Apple will contribute more than a third of the Japanese firm's total revenue in the year to March 2015. Japan Display's share price dropped to a 12-week low of 501 yen after first-quarter earnings on Aug. 7 lagged market expectations.

In Taiwan, home to several Apple suppliers and assemblers, export orders grew less than expected in July, even as factories rushed output ahead of new smartphone launches, reflecting the erratic nature of the business.

"Currently, there's a small shortage in supply of a specialised component for our communication devices," said a spokesman for Pegatron, which assembles iPhones. "This kind of problem regularly occurs and the impact on production is negligible."

Supply chain sources had previously said challenges with the new iPhone's screen in-cell technology, which eliminates one of the layers in the LCD screen to make it thinner, caused a delay in the production of the larger 5.5-inch version. One display industry source said the in-cell issues had now been resolved.

The pressure on Apple for stand-out products has increased as Samsung Electronics Co and, more recently, a clutch of aggressive, lower-cost Chinese producers such as Xiaomi Inc and Lenovo Group Ltd have eroded the U.S. company's market dominance.

The iPhone 6 unveiling has been widely anticipated to bolster momentum for Apple shares, which have risen by a third, to above $100 each, since the company posted strong first-quarter earnings in late-April.

source: www.abs-cbnnews.com

Samsung battles on two fronts as Apple readies iPhone 6

Research firm says iPhone 5s outsold Galaxy S5 in May
SEOUL - Samsung Electronics Co Ltd is losing smartphone ground not only to cheaper Chinese rivals but also at the high end to Apple Inc, a survey showed, in an ominous sign for the South Korean giant as Apple readies to launch its next-generation iPhone 6.

Samsung last week gave second-quarter earnings guidance that was far weaker than expectations and is on track for its worst quarterly profit in two years, a performance the company attributed in part to price competition and higher inventory levels in China.

Research firm Counterpoint's survey of 35 markets accounting for nearly 90 percent of global sales found that sales for the eight-month-old iPhone 5s stood at 7 million in May, compared with about 5 million for Samsung's flagship Galaxy S5, which was in just its second full month of sales after a late March release.

Counterpoint said that the Galaxy S5 appeared to be doing worse than the Galaxy S4 had done in its early launch against the iPhone 5, with each selling about 7 million units a month. The data measure retailers' sales to consumers as opposed to typical industry data that look at shipments made by the manufacturer.

Galaxy S5 sales probably remained at about 5 million units in June, said Tom Kang, Seoul-based analyst for Counterpoint. He said the Galaxy S5 fell short of market expectations in terms of display quality and by using a plastic case.

"They made one mistake, one product that didn't hold up to expectations and they are paying the price," he said in a phone interview. "They will have to move forward and leave behind what has failed and focus on the next product."

The data suggests that Samsung's problems run deeper than just the inventory buildup in mid-to-low tier devices that the company reported earlier in the month after disclosing weaker-than-expected second quarter guidance.

Samsung declined to comment on Counterpoint's data or disclose shipment figures for the Galaxy S5, though a Samsung executive in April said that the new flagship device was expected to outperform its predecessor.

"We will strengthen our product competitiveness by reinforcing our premium brand reputation, powerful product line-up, and cutting-edge technology," the company said in an email statement on Wednesday.

Data from research firm Canalys showed that Samsung's market share in the first quarter of 2014 fell to 18 percent from 20 percent a year earlier, while the likes of China's Xiaomi and Lenovo Group Ltd made gains.

Analysts said Samsung's new products such as the S5 did not offer enough to entice consumers to pay a premium over cheaper alternatives that were rapidly improving in quality.

"Most major smartphone brands worldwide are battling brand fatigue at the moment," said Strategy Analytics analyst Neil Mawston. "Consumers love their smartphones but almost all hardware, software and apps now look, feel or cost the same."

Apple, however, continues to be able to charge premium prices. Its iPhone 6 generation, expected to be launched as soon as September, is anticipated to sport bigger screens which would encroach on what has been a key Samsung advantage.

The Counterpoint data also suggest that Apple's smartphone sales have remained resilient even as anticipation for the new product launch builds. The U.S. company is expected to report its fiscal third-quarter results later this month.

SLOWING MARKET

Some slowdown for Samsung was expected following a record year of profits in 2013. Strategy Analytics forecasts global smartphone shipments growth this year to slow to 21 percent from 41 percent in 2013, while faster growth for cheaper smartphones was also expected to undermine margins.

Samsung's worse-than-anticipated operating profit guidance of 7.2 trillion won ($6.96 billion) for the April-June period caught analysts by surprise. Thomson Reuters I/B/E/S survey shows that 28 of 50 analysts polled have cut full-year profit forecasts for the company since the guidance was issued on July 8.

A worker at a South Korean carrier shop in central Seoul said sales of the iPhone 5s and the Galaxy S5 were roughly equal at his store, even though the Apple device had been on the market since October in South Korea.

"IPhone sales have been consistent and the differentiating factor for it is the design," said the worker, who only wanted to be identified by his surname Kim as he was not authorised to speak to the media. "There isn't much difference in the design of a Galaxy phone or an LG phone."

Some analysts said Samsung should bite the bullet and cut prices across the board, trading short-term margins for market share, while others say Samsung should look at more innovative change such as introducing flexible displays.

Counterpoint's Kang said Samsung may also need to consider adopting a new brand for its high-end products.

"The Galaxy brand has been weakened because it's selling $100, $200, $300 phones while Apple only sells $400 and above, so they might even need to throw away their Galaxy brand," he said.

source: www.abs-cbnnews.com

New iPhone 6 screens to enter production as early as May

TOKYO - Apple Inc suppliers will begin mass producing displays as early as May for the next iPhone, expected to be launched this autumn, with a 4.7-inch screen likely to be produced first while a 5.5-inch version could be delayed, supply chain sources said.

Japan Display Inc, Sharp Corp and South Korea's LG Display Co Ltd have all been tapped to make the screens, said the sources, who asked not to be identified.

Representatives for the three suppliers and for Apple declined to comment.

Both iPhone 6 screens will be larger than the 4.0-inch panels on Apple's existing iPhone 5S and 5C models.

Larger iPhones, the subject of months of speculation, would mark yet another incremental tweak to the popular smartphone line and an attempt to catch up to rivals like Samsung Electronics Co Ltd.

The company that helped to define American technology innovation is under increasing pressure to once again revolutionize the gadget industry, but CEO Tim Cook, while promising only "new product categories" for 2014, has played his cards close to his chest.

Apple's shares have languished below $600 since November 2012, in part because of worries about smartphone market saturation and its ability to stay at the forefront of tech innovation.

Both iPhone 6 screens are expected to use in-cell touch panel technology - built into the screen and allowing for thinner construction than with standard touch panel films - that was introduced with the iPhone 5, the sources said.

But due to difficulties with in-cell production technology for the larger 5.5-inch size, one of the sources said, a decision was made to begin mass production with the 4.7-inch version alone.

Production of 5.5-inch screens is expected to start several months later, with the possibility of a shift to a film sensor instead of in-cell technology for that size, the source said.

Japan Display will be the first supplier to start production, at its flagship plant at Mobara, east of Tokyo, as early as May, the sources said. The others are due to begin output around June.

source: www.abs-cbnnews.com