Tag Archives: Investment & Company Information

Apple sold enough iPhones and services last quarter to reverse a downward revenue trend

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After four consecutive quarters of revenue decline, Apple broke the trend and reported its first period of revenue growth today. In its earnings report for the first quarter of the financial year of 2024, the company announced a quarterly revenue of $119.6 billion, which is an increase of 2 percent from the same period last year. 

In addition, Apple CEO Tim Cook said its "installed base of active devices has now surpassed 2.2 billion, reaching an all-time high across all products and geographic segments." This quarter includes money brought in from the sales of the iPhone 15 line introduced in September 2023, which had an obvious impact on performance. 

"Today Apple is reporting revenue growth for the December quarter fueled by iPhone sales, and an all-time revenue record in Services,” Cook said. He noted the company hitting "all-time revenue records across advertising, Cloud services, payment services and video as well as December quarter records in App Store and Apple Care." Cook recapped some updates made to the Apple TV app, as well as TV+ content earning nominations and awards. 

Cook went on to remind us during the company's earnings call that tomorrow is the launch day for the Vision Pro headset, calling it historic. After saying that Apple is dedicated to investing in new technologies, Cook added that the company will be sharing more about its developments in AI later this year. 

Products in the wearables, home and accessories categories didn't fare well in this quarter, though sales in the Mac department did increase year over year. iPad sales in particular dropped 25 percent over the same period last year, though Cook attributed that to a "difficult compare" to the big numbers recorded in the first quarter of 2023 due to new models with refreshed Apple Silicon. Considering the company did not release a new iPad model in 2023 at all, this is not surprising. 

Cook continued by highlighting developments like Apple opening its 100th retail location in Asia Pacific and updates on its sustainability efforts. He wrapped up by saying "Apple is a company that has never shied away from big challenges," adding "so we're optimistic about the future, confident in the long term and as excited as we've ever been to deliver for our users."

This article originally appeared on Engadget at https://www.engadget.com/apple-sold-enough-iphones-and-services-last-quarter-to-reverse-a-downward-revenue-trend-223109289.html?src=rss

Samsung is betting on AI and the Galaxy S24 to turn around declining profits

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Samsung has failed to recover from the sharp decline in profit it experienced in 2022. In its latest earnings report, the Korean company has reported KRW 258.94 trillion ($194 billion) in annual revenue and KRW 6.57 trillion ($4.9 billion) in operating profit for the fiscal year of 2023. Those are markedly smaller numbers than the previous fiscal year's, especially the latter's — Samsung posted an operating profit of KRW 43.38 trillion ($35 billion) for 2022, which was already $6.9 billion smaller than the year before due to the weak demand for its chips and smartphones. According to The Wall Street Journal, these numbers represent Samsung's weakest earnings in over a decade. 

The company says its memory business showed signs of recovery, but not enough to stop it from incurring KRW 2.18 trillion ($1.63 billion) in operating losses for the fourth quarter of 2023. According to Nikkei, this is the semiconductor division's first annual loss in 15 years since the 2008 global financial crisis, and it's the biggest one yet. Samsung's visual display and digital appliances division also posted KRW 0.05 trillion ($37.5 million) in operating losses despite TV sales doing well in the fourth quarter due to the holiday season. Samsung's mobile business showed a a decline in sales and profit quarter-on-quarter, as well, due to lower smartphone sales and "the fading of new-product effects" from previous flagship models. 

For the first quarter of 2024, Samsung's game plan is to improve its profits "by increasing sales of high value-added products," such as components meant for generative AI products. It expects stronger demand for its chips in the PC and mobile sectors this year, but it admits that its earnings may not significantly recover soon because its customers are still downsizing their inventories. Samsung has high hopes for the Galaxy S24 series, though, and believes the devices' AI capabilities can help its mobile business achieve a a double-digit growth in 2024. The Galaxy S24 phones have already started shipping with prices starting at $800 for the most basic version and at $1,300 for the S24 Ultra. 

Update, January 31, 2024, 6:44AM ET: Added information about the semiconductor division's historic losses.

This article originally appeared on Engadget at https://www.engadget.com/samsungs-annual-profits-continued-to-decline-in-2023-090500640.html?src=rss

Microsoft’s gaming revenue was up 49 percent in Q2, mostly thanks to the Activision deal

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Microsoft posted another blowout earnings report for Q2 of the 2024 fiscal year, with revenues of $62 billion (up 18 percent from last year) and profits of $21.9 billion (a 33 percent increase). But really, the most interesting thing about this quarter is that we finally get to see how the $68.7 billion Activision Blizzard acquisition affects the $3 trillion company. While Microsoft isn't breaking out specific numbers, it says that its overall gaming revenue increased by 49 percent, 44 points of which came from the "net impact" of the Activision deal.

The rosy news is a bit surprising, considering that Microsoft announced last week that it was laying off 1,900 people across Xbox and Activision Blizzard. Those layoffs include the rest of Blizzard's esports division, according to reports, following 50 layoffs and a restructuring last summer.  

Microsoft's More Personal Computing division, which includes Xbox, Surface and Windows, was up 19 percent ($16.9 billion) since last year. The company says the Activision deal accounted for 15 points of that increase. It's a huge change for a division that's been severely impacted by dwindling PC sales (which affects Windows licenses and Surfaces) and struggling Xbox consoles. PC device revenues were down 9 percent for the quarter, while Xbox hardware sales were up 3 percent.

Xbox content and services revenue is also up 61 percent since last year, 55 points of which comes from Activision. It'll be interesting to see if Microsoft can actually leverage that acquisition to help Xbox sales, or at the very least, spur on more interest in Game Pass subscriptions. (Unfortunately, we don't have any updates on how that service is doing.)

This article originally appeared on Engadget at https://www.engadget.com/microsofts-gaming-revenue-is-up-49-percent-in-q2-mostly-thanks-to-the-activision-deal-222502444.html?src=rss

PayPal is laying off 2,500 employees

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PayPal is laying off nine percent of its workforce, the company’s CEO Alex Chriss told staff in a letter on Tuesday that PayPal made public hours later. The decision will impact about 2,500 employees, who will find out their fate between today and the end of the week, Bloomberg reported earlier. PayPal's layoffs come almost exactly a year after the company fired more than 2,000 workers to keep costs down. 

Despite thousands of job cuts in 2023, layoffs at tech companies have continued into 2024. On the same day as PayPal's latest layoffs, Jack Dorsey's Block, the company that owns Cash App, Foundational, and Square, conducted its second round of layoffs in two months, cutting nearly a thousand people. Earlier this month, Google laid off more than a thousand workers in its Assisstant and hardware divisions, with CEO Sundar Pichai warning employees to brace for more cuts through the year. Discord, eBay, Riot Games, TikTok, Microsoft, iRobot, Amazon, Unity, and Duolingo, among others, have collectively cut thousands of jobs in January

PayPal was one of the earliest companies in online payments industry, but in recent years, rivals like Zelle and tech companies with deep pockets like Apple, have entered the space. The competition in the payments industry is putting pressure on PayPal. Bloomberg noted that four analysts have downgraded the company’s stock this month. The company will "continue to invest in areas of the business we believe will create and accelerate growth," Chriss said in the letter. 

PayPal's layoffs are happening despite the company's strong growth throughout 2023. The company's revenue as of September 2023 was $7.42 billion, an increase of more than eight percent compared to its revenue a year before. It beat earnings expectations and reported a "double digit growth" in the number of transactions that happened over its platform. The Information noted that Chriss, who took over as the company's CEO in September 2023, said in PayPal's last earnings call in November 2023 that its costs were "too high" and were "slowing us down."

This article originally appeared on Engadget at https://www.engadget.com/paypal-is-laying-off-2500-employees-214628203.html?src=rss

Amazon terminates $1.4 billion iRobot acquisition after EU veto threat

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Amazon and iRobot, maker of the Roomba vacuum line, just announced that they would be dropping their proposed merger. The potential acquisition was announced back in August of 2022 and was immediately the target of antitrust watchdogs, particularly in the EU. The European Commission (the EU's executive branch) officially announced it was looking into the $1.4 billion dollar deal last July and it raised formal concerns over the potential impact on competition in November. 

iRobot also just announced a large round of layoffs now that the deal isn't going through. The company says it is laying off about 350 employees, which represents 31 percent of iRobot's workforce. Colin Angle, founder, chairman of the iRobot board of directors and CEO is also stepping down as chairman and CEO, effective today.

While the companies didn't mention the pressure from the EU specifically, Bloomberg notes that a veto looked likely. And while that might not have immediately killed the deal, Amazon and iRobot appear to have decided to shut things down completely rather than work through any proposed changes to make the deal more palatable to regulators. The deal was also said to be under scrutiny from the FTC here in the US, but it never quite reached the level of attention it was receiving from the EU. 

Unsurprisingly, Amazon's statement on the matter blasts regulators for the "innovation" that would come with Amazon scooping up yet another company. "This outcome will deny consumers faster innovation and more competitive prices, which we're confident would have made their lives easier and more enjoyable," said Amazon SVP and General Counsel David Zapolsky in a statement. "Mergers and acquisitions like this help companies like iRobot better compete in the global marketplace, particularly against companies, and from countries, that aren't subject to the same regulatory requirements in fast-moving technology segments like robotics."

iRobot's statement was more muted. "The termination of the agreement with Amazon is disappointing, but iRobot now turns toward the future with a focus and commitment to continue building thoughtful robots and intelligent home innovations that make life better, and that our customers around the world love," said former CEO Colin Angle.

Earlier in January, the European Commission was said to have warned Amazon that the deal was on thin ice. However, according to Reuters, the company declined to offer any potential remedies to soothe the bloc's concerns over the acquisition. As outlined in the original agreement, Amazon is paying iRobot a $94 million termination fee now that the deal is dead.

This isn't exactly the first time Amazon and the EU have butted heads. They previously squared off over the company's handling of third-party seller information. In 2022, the two sides reached an agreement over Amazon's treatment of third-party sellers.

This article originally appeared on Engadget at https://www.engadget.com/amazon-abandons-14-billion-irobot-acquisition-after-eu-veto-threat-140155112.html?src=rss

SEC approves bitcoin ETFs (for real this time)

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The Securities and Exchange Commission has approved the applications of 11 spot bitcoin ETFs in a highly anticipated decision that will make it much easier for people to dabble in cryptocurrency investing without directly buying and holding bitcoin. The approval comes one day after a hacker temporarily took over the SEC’s X account and posted a rogue tweet saying that bitcoin ETFs had been approved by the regulator.

The approval is a significant milestone for crypto investors, who for years have tried to win SEC approval for the investment funds that hold bitcoin. With the approval, 11 such funds will be listed on public stock exchanges.

United States financial regulators have long been wary of bitcoin and other cryptocurrencies and in a statement, SEC Chair Gary Gensler wasn’t exactly effusive about the merits of bitcoin. “Bitcoin is primarily a speculative, volatile asset that’s also used for illicit activity including ransomware, money laundering, sanction evasion, and terrorist financing,” he wrote.

“While we approved the listing and trading of certain spot bitcoin ETP shares today, we did not approve or endorse bitcoin. Investors should remain cautious about the myriad risks associated with bitcoin and products whose value is tied to crypto.”

Gensler may have more reasons than usual to be circumspect. On Tuesday, one day before the SEC’s decision on bitcoin ETFs was due, the SEC’s official X account was hacked. The attackers posted a rogue tweet claiming the funds had been approved, causing a temporary spike in the price of bitcoin. The SEC has said it’s working with the FBI and Inspector General to investigate the matter.

This article originally appeared on Engadget at https://www.engadget.com/sec-approves-bitcoin-etfs-for-real-this-time-224125584.html?src=rss

Unity is cutting a quarter of its workforce

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Gaming software developer Unity plans to lay off 1,800 employees or about a quarter of its global workforce, according to a securities filing first spotted by The Wall Street Journal. The company said it made the move "as it restructures and refocuses on its core business" in an aim to get back to profitability. The cuts follow major turbulence in the company after it angered developers by introducing and then partially walking back a controversial runtime fee for its game engine. 

The layoffs add to the more than 1,100 jobs it has eliminated since 2021. Unity fired 265 people in November as part of what it called a company "reset," all of whom were employed as part of its 2021 Weta Digital acquisition. The company also closed down 14 offices around the world. In May of 2023, it announced it would let go around 600 employees, following layoffs of over 500 people in 2022. 

Last September, Unity rolled out some significant concessions to its developer pricing model after widespread backlash over its plan to charge developers for game installations. CEO John Riccitiello, who took much of the brunt of the criticism, stepped down shortly afterwards and was replaced by former IBM president James Whitehurst, who continues to serve as interim President and CEO.

After reporting record profits for 2022, the company has missed revenue forecasts over the last three quarters. In a shareholder letter, the company said it aims to emerge from restructuring as a "leaner, more agile and faster growing company." Unity's game engine is used in titles like Cuphead, GTFO and Kerbel Space Program. 

With game sales flat over the past year, Unity isn't the only company in that industry to see layoffs. As we detailed in our year-end video game roundup, The Embracer Group, which owns studios like Crystal Dynamics, Square Enix Montreal and Gearbox Software, laid off more than 900 people. Epic Games fired around 830 people, Sony cut 100 jobs at Bungie, CD Projekt RED and Sega laid off 100 employees each and Electronic Arts reduced 6 percent of its workforce, or around 1,130 employees. 

This article originally appeared on Engadget at https://www.engadget.com/unity-is-cutting-a-quarter-of-its-workforce-074331467.html?src=rss

Tesla says it delivered a record 1.8 million EVs in 2023

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Tesla has unveiled its EV delivery and production figures for 2023, and the company had another banner year — but it has Chinese rival BYD close behind. Elon Musk's company produced 1.846 million EVs last year and delivered 1.809 million, besting 2022 deliveries by a wide 38 percent. Those figures include 494,989 EVs produced last quarter and 484,507 delivered.

Tesla's originally projected it would sell 2 million vehicles in 2023, but revised that figure downward in its October 2023 earnings call. It did exceed analyst expectations for Q4 2023, though, according to CNBC. 

Tesla built 476,777 Model 3 and Model Y EVs last quarter and delivered 461,538 of them. Those include sales of the refreshed "Highland" Model 3. While Elon Musk predicted last quarter that the Model Y would become "the bestselling car on Earth," the company didn't break down sales between its two most popular models. The company sold 18,212 "other models" consisting of Model S and Model X EVs. There are no sales figures yet for the Cybertruck. 

Tesla has battled some negative press with its EV lineup, particularly around its Autopilot system, which has seen regulatory scrutiny in the US and other countries. EV sales no doubt received a boost from several price drops over the last year as well, with the Model 3 and Model Y most recently dropping to $38,990 and $45,990, respectively. Tesla chalked up the price drops to "economic uncertainty, higher interest rates, and shifting consumer sentiment" in its October earnings call. 

One of Tesla's biggest markets is China, but the company is facing stiff competition there from another EV giant, BYD. That company announced sales of 3.02 million electrified vehicles in 2023, including 1.6 million were fully electric cars and 1.4 million hybrids. Most of BYD's EVs sell at significantly lower price points that Tesla's cars, however. 

This article originally appeared on Engadget at https://www.engadget.com/tesla-says-it-delivered-a-record-18-million-evs-in-2023-082906995.html?src=rss

Electric scooter rental company Bird files for bankruptcy two years after going public

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After laying off nearly a quarter of its staff last year, e-scooter rental company Bird has filed for Chapter 11 bankruptcy, the company announced. Existing lenders have agreed to purchase the assets and the company is being kept afloat via a $25 million loan from Apollo Global Management (Yahoo and Engadget's owner) and second-lien lenders, according to The Wall Street Journal. 

The company will continue to operate as normal and "has sufficient liquidity to meet financial obligations to city partners, vendors, suppliers, and employees during and after the restructuring process, and will operate as usual," the company wrote. The filing doesn't affect Bird Canada or Bird Europe, which are separate organizations.

Bird aims to sell off its assets for the highest possible price via a “stalking horse” agreement that will set in motion an auction of sorts. Its current lenders will designate a baseline bid before opening the proceedings to other bidders over the next few months.

Bird went public in 2021 via a "SPAC" (special purpose acquisition company) with an implied valuation of $2.3 billion, but its stock cratered less than a year later. Founder Travis VanderZanden stepped away late in 2022, at which point his stake in the company was worth less than his Miami house, according to a Crunchbase report. Bird was forced to delist from the New York Stock Exchange this year due to a valuation that was too low. 

Bird launched in multiple cities in 2017-18 with a fair amount of hype as e-scooters were seen as a sustainable urban mobility solution. It continued to grow despite a lack of profitability (following the Uber model), but the COVID pandemic forced the company to halt operations in multiple locations around the world. Since then, cities have also become more hostile to e-scooter rentals, with some seeing them now as a potential safety hazard and eyesore. 

This article originally appeared on Engadget at https://www.engadget.com/bird-files-for-bankruptcy-after-going-public-in-2021-092905867.html?src=rss

Adobe terminates its $20 billion Figma acquisition amid regulatory scrutiny

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Adobe is abandoning its planned $20 billion acquisition of Figma after the companies determined that there was no clear path to obtaining approval from UK and European Union regulators. The two sides have signed an agreement that fully resolves all aspects of the Adobe-Figma merger termination. Adobe will pay the collaborative design platform a previously agreed $1 billion termination fee after failing to overcome regulatory hurdles.

In November, the UK's Competition and Markets Authority (CMA) and the European Commission both cited concerns over the proposed acquisition's impact on competition. The CMA said in its provisional findings that that the merger would “eliminate competition between two main competitors.” The watchdog said it was considering either blocking the deal or requiring Adobe to sell Figma's core product, Figma Design, along with Adobe XD.

Earlier on Monday, Adobe claimed that it wouldn't offer the CMA any potential remedies. “It is clear that no realistic remedy would satisfy the concerns the CMA is maintaining,” an Adobe spokesperson told Bloomberg. “We believe that the best path forward is to continue our ongoing engagement with the CMA on the merits.”

Last month, the EC sent Adobe a Statement of Objections, in which it warned the company that its planned purchase of Figma "may reduce competition in the global markets for the supply of interactive product design software and of other creative design software," such as vector editing tools (i.e. Illustrator and its ilk) and Photoshop-style raster editing tools. The EC planned to make a final decision on the merger by February 5. Adobe had indicated it was willing to offer possible remedies to appease European regulators, but it appears that's no longer the case.

“Adobe and Figma strongly disagree with the recent regulatory findings, but we believe it is in our respective best interests to move forward independently,” Shantanu Narayen, Adobe chair and CEO, said in a statement. “While Adobe and Figma shared a vision to jointly redefine the future of creativity and productivity, we continue to be well positioned to capitalize on our massive market opportunity and mission to change the world through personalized digital experiences.”

Adobe also anticipated a potential lawsuit from the US Department of Justice in an attempt to block the deal Stateside. The company and Figma reportedly met with DOJ officials last week to try and secure approval for their merger. 

This article originally appeared on Engadget at https://www.engadget.com/adobe-walks-away-from-its-20-billion-figma-acquisition-amid-regulatory-scrutiny-132203336.html?src=rss