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| January 28, 2015 | |
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| Good morning, Data Sheet readers! With Apple and Yahoo reporting, it was a big day for tech earnings yesterday—and is expected to be today and tomorrow, too. So let’s get right down to it. (As before, Heather Clancy is out for the week. Feedback? Tell me on Twitter @editorialiste.) | |
| WHAT YOU MISSED | |
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| How big was Apple's latest quarter? The biggest of all time—for anyone. $75 billion in revenue, $18 billion in profit, and enough gold iPhones to make Solomon blush. (For analysis from Fortune's Adam Lashinsky, read on.) ...oh, and the Apple Watch is coming in April. Okay? ...and there's also a new iOS update. Gird your loins. Yahoo announces a spinoff of its Alibaba stake, in the latest shot fired by CEO Marissa Mayer. (I'd call her embattled, but that seems to be part of the job description.) The move will give the company a cheap way to please activist investor Starboard Value. (For analysis from Fortune's Erin Griffith, read on.) "Ghost" is targeting Linux systems by allowing code execution. It's a swing and a miss for VMware, the virtualization master, in its latest earnings report, despite a 15% increase in revenue to $1.7 billion. The struggle to keep up with the shift to cloud-based software is real. Remember the Regin malware that bedeviled so many IT departments? Researchers have a new lead on it. Sony lays off 1,000 workers in its mobile phone group because it wants profits, not losses. In its latest earnings report, AT&T's "profits and customer retention showed signs of strain from the heightened competition among the nation's biggest carriers." Somewhere, John Legere is smiling. The Microsoft Surface is dead! Long live the Microsoft Surface. Waze rejects LAPD's claim that it's a danger to police in the field. | |
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| YOU OUGHTA KNOW | |
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| Facebook and Qualcomm report quarterly earnings today. Tomorrow: Amazon, Alibaba, Google. Registration has opened for Facebook's F8 conference. It'll set you back about $500. Netflix is overhauling its data architecture to better stream movies. Follow the link for the technical explanation, but in layman's terms: it needs to know more about your interactions with the service, and it needs to build that system at massive—and I mean massive—scale. Slack, the business collaboration software company, tries to explain why people like Slack. (And probably raises more questions about your work processes than you'd care to admit.) One more nail in the coffin for Flash: YouTube. (Related: The power of defaults.) The FCC reminds hoteliers that it prohibits blocking Wi-Fi within properties. It calls it "a disturbing trend," which is also how I feel about modern faucets that appear impossible to turn on. They found a security vulnerability in the seemingly bulletproof Blackphone. Whoops. | |
| BURNING QUESTIONS | |
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| A tech startup called Earnest seems like something from Silicon Valley, right? How much is your company spending on so-called shelfware? Can a hackathon fix a broken hiring system? Some folks think so. | |
| EARNINGS-PALOOZA | |
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| AAPL and YHOO reported earnings yesterday, and two Fortune colleagues weighed in last night on what it meant. Below, excerpts from senior editor-at-large Adam Lashinsky and writer Erin Griffith. Lashinsky on AAPL: What a difference a new product or three make. With the iPhone 6, 6 Plus, and Apple Pay reflected in its numbers, Apple's revenue grew 30% last quarter. Companies with nearly $58 billion in quarterly revenue, Apple's year-ago figure, don't grow at a 30% clip. But Apple's did, putting up numbers reminiscent of its incredible run during the late Steve Jobs years. The company grew profits by an even greater percentage, 38%. Apple ended the quarter with $178 billion in cash, up nearly $23 billion. A few more thoughts: * Apple sold 74.5 million phones. In one quarter. CEO Tim Cook said in a call with investors that the iPhone 6 was the most popular iPhone but that the iPhone 6 Plus, 5s, and 5c were selling well too. He said without elaborating that different models are popular depending on geography, implying that some locales like bigger screens more than others. * The average selling price of an iPhone was $687, up a stunning $50 per phone. Name another product in our low-inflation times that hauls in an 8% greater price over the course of a year, especially in technology. By the way, Apple said channel inventory for iPhones is lower than it hoped, meaning it can't make them fast enough. * Macs are growing at a rate of 14% and a time the overall personal-computer market is shrinking. This is an annuity business for Apple. A lucrative annuity. For four more points, head over to Fortune.com. Griffith on YHOO: With the Alibaba shares separated from Yahoo's core business, [Yahoo CEO Marissa] Mayer is under more pressure than ever to deliver the turnaround she was hired to execute. She spent the majority of Yahoo's earnings call touting the company's progress on her plan, which carries a new acronym: MaVeNS. MaVeNS stands for mobile, video, native and social. (The awkward term follows the advertising world's equally as cumbersome "SoLoMo," as in social, local, mobile.) Mayer believes growth in these areas will offset declines in display advertising. She touted growth in Yahoo's mobile business, which brought in $254 million in revenue in the fourth quarter, a 23% increase over the previous quarter. Yahoo's media properties now reach more than 575 million people each month. Mobile accounted for $1.26 billion in gross revenue for the year. It's encouraging growth—that revenue did not exist before Mayer joined the company. "In late 2012, this management team changed course from a confused, web-based strategy which preceded us, to a beautiful, app-based strategy," she said during the call. But that is still a small sliver of Yahoo's overall business, which continues to shrink. The company's $1.179 billion in quarterly revenue was a 1% decline from last year. The company's net earnings of $166 million marks an 84% decline over the year prior. And Yahoo's non-GAAP earnings per share of $0.30 is a 35% decline over the year prior. For the rest, you know what to do. | |
| FORTUNE FIVE | |
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| Zappos is bringing Uber-like surge pay to the workplace, by Claire Zillman. 5 reasons you shouldn't believe the government's debt projections, by Chris Matthews. Surviving the open office trap, by Edward Brown. The next space race will be among Fortune 500 companies, by Clay Dillow. Square tries to make open source "welcoming and inspiring" to women, by Michal Lev-Ram. | |
| ONE MORE THING | |
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| NFL athlete Marshawn Lynch gave a press conference in which he said the following words, over and over: "I'm just here so I won't get fined." Which tech CEO would be most likely to pull such a stunt? I wonder. | |
| MARK YOUR CALENDAR | |
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| IBM Interconnect: Cloud and mobile strategy. (Feb. 22 - 26; Las Vegas) Gartner CIO Leadership Forum: Digital business strategy. (March 1 - 3; Phoenix) Microsoft Convergence: Dynamics solutions. (March 16 - 19; Atlanta) IDC Directions 2015: Innovation in the 3rd Platform era. (March 18; Boston) Cisco Leadership Council: CIO-CEO thought leadership. (March 18 - 20; Kiawah Island, South Carolina) Gartner Business Intelligence & Analytics Summit: Crossing the divide. (March 30 - April 1; Las Vegas) Knowledge15: Automate IT services. (April 19 - 24; Las Vegas) RSA Conference: The world talks security. (April 20 - 24; San Francisco) Forrester's Forum for Technology Leaders: Win in the age of the customer. (April 27 - 28; Orlando, Fla.) MicrosoftIgnite: Business tech extravaganza. (May 4 - 8; Chicago) NetSuite SuiteWorld: Cloud ERP strategy. (May 4 - 7; San Jose, California) EMC World: Data strategy. (May 4 - 7; Las Vegas) SAPPHIRE NOW: The SAP universe. (May 5 - 7; Orlando, Florida) Gartner Digital Marketing Conference: Reach your destination faster. (May 5 - 7; San Diego) Annual Global Technology, Media and Telecom Conference: JP Morgan's 43rd invite-only event. (May 18 - 20; Boston) HP Discover: Trends and technologies. (June 2 - 4; Las Vegas) | |
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