Tag Archive | "apple"

Nokia Refutes Talk Of Microsoft Sale; Ticonderoga Likes It

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Shares of Microsoft (MSFT) have been under pressure this morning, and one thing appearing to contribute to downturn are rumors the company would step in to purchase Nokia (NOK) for $19 billion, according to remarks by Eldar Murtazin, a blogger widely credited with scooping Microsoft’s deal with Nokia earlier this year.

Murtazin’s blog appears not to have that claim today, but he is cited as stating such by Todd Haselton in a piece this morning on BoyGeniusReport.

A Nokia spokesperson, however, tells The Wall Street Journal’s Christopher Lawton a short while ago that, “These rumors are completely baseless.”

Murtazin has speculated as recently as May 16th that the two companies were talking about a deal.

Microsoft shares are down 54 cents, or 2%, at $24.47.  Nokia shares are down 34 cents, or almost 5%, at $6.68.

Well, at least one believer this morning is Brian White with Ticonderoga Securities, who follows Apple (AAPL) and has a Buy rating and a $612 price target on that stock.

“We believe reports from Boy Genius highlighting the potential for a Microsoft purchase of Nokia for $19 billion should provide Apple investors with even greater confidence that the company can continue to gain market share at the expense of legacy vendors in the mobile phone market,” writes White.

“In our view, Apple investors could not ask for a better deal, and we believe a transaction would only further Apple’s market share gains in the coming quarters.”

Sounds like White is choosing his words carefully, but it also sounds like he believes the rumor.

Article courtesy of Tech Trader Daily

Apple: iPhone Should Bolster Margins, Says Jefferies

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Jefferies & Co. analyst Peter Misek this morning seeks to allay fears of a gross profit erosion at Apple (AAPL), writing that “concerns on serious gross margin deterioration are overdone,” and reiterating a Buy rating and a $500 price target.

Apple’s overall corporate gross profit margin will likely find a “floor” at 35%, he thinks, and perhaps range as high as 40% over the course of the next year. (Apple’s gross margin as a percentage of sales was 41.4% in the quarter ended in March, and 39.9% for the six-month period ending that month. Those numbers were down slightly from 41.7% and 41.2% for the corresponding periods a year earlier.)

Misek points out Apple is able to add $100 to the price of an iPhone for flash memory content that costs the company only $20 to $30 per part, leading to iPhone margin of 50%, the highest for any of its products. He expects a re-acceleration of iPhone sales based on the prospect Apple will have a “mid-marketiPhone in the $300 range (in other words, cost to the wireless operator, before subsidy), in addition to the expected iPhone 4S and the iPhone 5, which he expects in June of next year.

A cheaper iPhone at the mid-market would increase Apple’s addressable market by 500 million phones per year, and if such a device were made with a $180 cost of goods, every 10 million of them sold would add $1 to Apple’s per-share profit.

Misek also thinks Apple can maintain gross margin on the iPad at around 35% to 40% “over the medium term,” thanks to the higher-priced, more feature-rich models of the device.

Article courtesy of Tech Trader Daily

Richard Garriott’s Portalarium raises money for Facebook games

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Portalarium, the social and mobile game company founded by game pioneer Richard Garriott, has raised a second round of funding. Altogether, the Austin, Texas-based startup has raised $3.6 million to date.

The financing includes money from m8 Capital in the United Kingdom and Founders Fund (the investment fund which includes PayPal co-founder Peter Thiel) in San Francisco.

Garriott has vowed to create the same kind of fun games on Facebook as he did at earlier stages in his career. Earlier this year, Garriott said in an interview that Portalarium is aimed at exploiting the business opportunities in the “third age of video games.”

For those of you who didn’t grow up playing games, it may help to know that Garriott was present for the first age of video games, with the debut of great single-player games such as  Ultima, which was followed by many sequels. In 1997, under his alter ego Lord British, Garriott extended his role-playing fantasy world to the online multiplayer game Ultima Online. Garriott considers the rise of Internet-connected games to be the second age of video games. Garriott tried to exploit that age with Tabula Rasa, one of the most ambitious sci-fi online games, but that title met with an untimely death after six years of effort.

The third age began with the explosive growth of simple, quickly played social games like Zynga’s FarmVille on Facebook. In an interview at the Dice Summit game conference in Las Vegas, Garriott said he knows he is late and the gold rush into social games has happened without him so far. Portalarium launched two simple casino games on Facebook so far in order to test the company’s theories about player engagement, or the trick of getting gamers to play games for a long time.

“We are delighted to join Richard Garriott and the Portalarium team in creating the next great gaming company,” said Joseph Kim, general partner at London-based m8 Capital. “Richard is one of the giants of the industry. He’s a proven entrepreneur and has been a driving force at each of the industry’s major turning points.”

Kim said he liked Garriott’s vision for the future of mobile and social games. Ditto for Brian Singerman of the Founders Fund.

In the past year, Portalarium has released two games — Port Casino Poker and Port Casino Blackjack –  on Facebook and the hi5 social network. According to AppData, those games have just a small number of users. But Portalarium says that those are evergreen products that were created to quickly build out the company’s backend server technology and start interconnecting a player network across platforms and social networks. Port Casino Poker recently launched Apple’s iPad and both iPhone and Android versions are coming later this year.

Fred Schmidt, chief executive of Portalarium, said that the connection with m8 Capital will help the company shape its European strategy while the Founders Fund (which backed Facebook) connection is helping the company connect to the social media scene in Silicon Valley. Portalarium was founded in 2009 and has 12 employees.

We’ll be exploring the most disruptive game technologies and business models at our third annual GamesBeat 2011 conference, on July 12-13 at the Palace Hotel in San Francisco. It will focus on the disruptive trends in the mobile games market. GamesBeat is co-located with our MobileBeat 2011 conference this year. To register, click on this link. Sponsors can message us at sponsors@venturebeat.com. To participate in our Who’s Got Game? contest for the best game startup, click on this link.

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Article courtesy of VentureBeat » deals

Write-Offs: 05.31.11

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$$$ House Prices Fall to New Post-Bubble Low as More Rent (NYT)

$$$ Consumer confidence drops in May (Reuters)

$$$ House Set to Reject Debt Ceiling Hike Democrats Dismiss as “Political Charade” (ABC)

$$$ Bernie Madoff Is Ruining Divorces Now, Too (Daily Intel)

$$$ Obama names Bryson as commerce chief (WaPo)

$$$ Primary Global Shuts Offices, but Says It’s Still Open (Dealbook)

$$$ Spain Cuts Budget Deficit in Half (WSJ)

$$$ Goldman shares climb on JPMorgan upgrade (Reuters)

$$$ Ex-Galleon trader presents no defense at NY trial (Reuters)

$$$ A Securities and Exchange Commission worker gave investors false and misleading information about an alleged Ponzi scheme that could have hindered investigation of a fraud in which he also was a victim, the agency’s watchdog said. The employee, based at SEC headquarters in Washington, shared nonpublic information with several investors during the SEC’s investigation and litigation of the case, SEC Inspector General H. David Kotz said in his semiannual report to Congress released today. The report didn’t identify either the SEC employee or the firm accused of conducting the fraud. Kotz opened his probe in February after a senior official said the employee had contacted fellow investors and told them that the company was legitimate and that investors “would be receiving considerable sums of money,” according to the report. (Bloomberg)

$$$ Falcone Venture Said Weighing Deal With AT&T (Bloomberg)

$$$ RBS moves to tap into Chinese IPO market (FT)

$$$ Muni-Bond Group Bans Dual Adviser-Underwriter Roles (WSJ)

$$$ Asian Markets Draw Private-Equity Sales (WSJ)

$$$ Buyout Firms Morphing Into Asset Managers as Takeovers Dwindle (Bloomberg)

$$$ Lehman Presses Big Banks on Derivatives Settlement (WSJ)

$$$ Is bond trading dying? (Reuters)

$$$ Apple’s Jobs to Unveil iCloud Service (WSJ)

$$$ Japan pensioners volunteer to tackle nuclear crisis (BBC)

$$$ Sarah Palin, Donald Trump To Meet In New York City Tuesday Night (ABC)



Article courtesy of Dealbreaker

Apple: Remember They’re Nimble, Says Brigantine

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The Street continues to mull the consequences of an explosion Friday at Foxconn, a manufacturing partner to Apple (AAPL), among others.

A report late yesterday by market research firm iSuppli’s Dale Ford suggests the incident may result in 500,000 lost iPad 2 units per month, based on the firm’s analysis of the production capacity of that facility.

As I wrote yesterday, most analysts have pointed out the vast majority of iPad 2 units are produced for Apple at Foxconn’s Shenzhen facility, not the Chengdu plant where the incident took place. Chengdu accounts for about 20% of iPad 2 production, he estimates.

Some estimates for a 2.8 million-unit hit to production are “too pessimistic,” writes Ford: “The impact of this disaster will only last for the short term, given that there are more than 10 factories in the Foxconn Chengdu plant, and because the explosion occurred on the third floor of one of the buildings.”

Kevin Dede with Brigantine Advisors this morning reiterated a Buy recommendation on Apple, writing that while “investors are right to be concerned,” the stock already prices in near-term risks. The fact that Apple was able to bounce back from the March disaster in Japan shows how “fixable and nimble” the company can be in the face of supply-chain issues.

Surprising to us was Apple’s source supply management capability and its finding alternative sources for roughly 100 components to meet requirements for the production of 18.6M iPhones. On the heels of that veritable miracle, we are hesitant to second guess the company’s June outlook that might otherwise appear bullish in the face of the current sourcing and manufacturing predicament.

Apple shares this morning are down $2.25, or 0.8%, at $332.15.

Article courtesy of Tech Trader Daily

Apple: Remember They’re Nimble, Says Brigantine

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The Street continues to mull the consequences of an explosion Friday at Foxconn, a manufacturing partner to Apple (AAPL), among others.

A report late yesterday by market research firm iSuppli’s Dale Ford suggests the incident may result in 500,000 lost iPad 2 units per month, based on the firm’s analysis of the production capacity of that facility.

As I wrote yesterday, most analysts have pointed out the vast majority of iPad 2 units are produced for Apple at Foxconn’s Shenzhen facility, not the Chengdu plant where the incident took place. Chengdu accounts for about 20% of iPad 2 production, he estimates.

Some estimates for a 2.8 million-unit hit to production are “too pessimistic,” writes Ford: “The impact of this disaster will only last for the short term, given that there are more than 10 factories in the Foxconn Chengdu plant, and because the explosion occurred on the third floor of one of the buildings.”

Kevin Dede with Brigantine Advisors this morning reiterated a Buy recommendation on Apple, writing that while “investors are right to be concerned,” the stock already prices in near-term risks. The fact that Apple was able to bounce back from the March disaster in Japan shows how “fixable and nimble” the company can be in the face of supply-chain issues.

Surprising to us was Apple’s source supply management capability and its finding alternative sources for roughly 100 components to meet requirements for the production of 18.6M iPhones. On the heels of that veritable miracle, we are hesitant to second guess the company’s June outlook that might otherwise appear bullish in the face of the current sourcing and manufacturing predicament.

Apple shares this morning are down $2.25, or 0.8%, at $332.15.

Article courtesy of Tech Trader Daily

Intel: Must Win Apple To Fill The Fabs, Says Piper

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Piper Jaffray’s Gus Richard today reiterates a thesis he’s been making for several weeks now, namely that Intel (INTC) is gunning for Apple’s (AAPL) business to manufacture the iPhone maker’s custom processor, the “A” series of chips. 

Richard reiterated a Neutral rating on Intel shares. 

Richard repeats that Intel must find more contract business as it spends $10 billion this year beefing up its fabs, a doubling of last year’s capital spending.

Basically, the old PC business just won’t bring enough revenue to justify the business, but a deal to fab Apple’s chips would help a lot. (Richard doesn’t talk about how production of server chips and networking chips would help, but those are admittedly much smaller markets than the PC by volume.)

Richard thinks that with the leading contract foundries all investing in capacity, meaning Taiwan Semiconductor Manufacturing (TSM), Samsung (SSNLF), and Global Foundries, the spin-off from Advanced Micro Devices (AMD), Intel could hurt those competitors by denting their ROI if it wins Apple as a customer:

Intel is betting that it can fill its leading edge fab. The company continues to build capacity as if its silicon demand will stay on trendline. However, based on our analysis of the PC client market, this seems unlikely. We believe that Intel has also stepped up its efforts to get into the foundry business. In particular, Intel is vying for Apple’s foundry business. Apple is the largest buyer of leading edge silicon and a significant buyer of foundry wafers from Samsung. If Intel was Apple’s foundry partner and continued to supply baseband chips to Apple, Intel would start to impact leading edge volume growth at the foundries. This would impact demand for next generation process technology and slow the ROI of the foundries’ investment in process technology development at leading edge capacity.

A more certain result, however, is overcapacity: today he reiterated an Overweight rating on shares of Applied Materials (AMAT), but wrote that the company is likely to offer a weak forecast when it reports earnings on Tuesday, after the bell, given that Samsung appears already to be pushing out orders for equipment as customers re-allocate spending to other vendors. He thinks Apple is one of those customers, taking its DRAM dollars to other manufacturers:

We expect to see cancellations in CY11:Q3 as Samsung’s largest chip customers reallocate demand to other vendors. In addition, capital spending at the foundries has been too strong for too long and we expect to see a pause in this market as well.

Article courtesy of Tech Trader Daily

Apple: Al-Waleed Reaffirms His Faith On CNBC

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In case you missed, Saudi prince Al-Waleed Bin Talal was on CNBC this morning — he’s 26th on the Forbes billionaire list with $19.6 billion in personal net worth, in case you’ve lost count — and he was talking about about Apple (AAPL), among other things.

“We got into Apple at $9 many years ago, and Steve Jobs is my friend, I always visit him in California,” said Al-Waleed. “We always believed in Apple. Apple is a very good company, and they are the leader right now in the technology industry. Clearly, there are lots of challenges, they are being attacked from all fronts, but Apple is a big force to be reckoned with in the technology industry.”

(In the video clip below, the discussion of Apple comes in at about 7:40 into the set.)

Asked about growth, Al-Waleed said that the tablet and phone markets have “not yet peaked” for the company. Al-Waleed was also asked about the fate of the company given CEO Steve Jobs’s leave from day-to-day operations.

“Steve Jobs is a unique person, and he has good people with him. You know, he’s not managing the company on a day-to-day basis, but still the company is on a good track and doing good.”

On the general economic outlook, Al-Waleed said that the global economies went through “intensive care,” and “you don’t expect someone to go walking and jogging right away. Hopefully some jogging will take place soon.”

Remarking on the impending end of the Fed Reserve’s “QE2″ program of bond purchases, he likened it to a “scaffolding” of a building, arguing that when a scaffolding is taken away, the “building has to stand.” He doesn’t believe, in other words, that when QE2 ends in June, it will have a major impact on markets. Of greater concern is what is done with the U.S. budget deficit and “brinksmanship” over the U.S. debt ceiling, which he called a “time bomb.”

As long as the U.S. issue can be taken care of, there will be low growth for several years to come, he avers, but not a return to recession, despite European debt issues.

Article courtesy of Tech Trader Daily

RIM: ThinkEquity Starts At Hold, $48 Target

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ThinkEquity’s Mark McKechnie this morning initiated coverage of Research In Motion (RIMM) with a Hold rating and a $48 target, threading a path between what he sees as the bull and bear cases.

The bear case is that RIM’s BlackBerry service offering will see subscribers decline in coming years, but McKechnie actually thinks the company can add 16 million and 13 million subscribers in the next two years, for $4.25 per share in earnings, on top of what else it can generate. (He models $6.40 per share this fiscal year ending next February, and $6.55 in fiscal 2013.) The network service is the “core asset,” he writes.

But McKechnie also wonders why the company has talked about new handsets based on its “QNX” operating system, while not actually offering them for another year, essentially offering “vaporware,” as he sees it.

While the BlackBerry Bold 9900/9300 that were recently introduced, and that don’t run QNX, will see purchases this summer from loyal BB fans, he thinks the company may prompt IT shops to hold off on purchases until they see the next generation BlackBerry with QNX next year.

But actually the key issue for RIM, McKechnie, asserts, is how the company adjusts to rich media. RIM rose to prominence when phone companies wanted to keep bandwidth usage down in an era of low-bit-rate messaging traffic. That was back when they banned video from their wireless networks. But Apple’s (AAPL) iPhone’s support for video, etc. has up-ended that equation. “Thus, RIM’s advantage — a light footprint for email and messaging — becomes less important.”

As for tablets, McKechnie thinks this will be a two-horse race between Apple and Google’s (GOOG) Android, but he’s not altogether giving up on RIM’s “PlayBook” tablet — because of its support for Adobe’s (ADBE) “Flash” media technology, which could prove appealing to some corporate users: “We do see a market, particularly in the corporate space, which requires Flash support and thus gives RIMM an opening, in our view.”

RIMM shares this morning are down 62 cents, or 1.4%, at $43.61.

Article courtesy of Tech Trader Daily

Apple, Google Rise In Q1 Mobile Sales, Says Gartner

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Research firm Gartner this afternoon offers its latest update on the global mobile device market, citing an 19% rise in everything from the lowest-end phones to the smartphone.

Smartphones made up 23.6% of the market in Q1, says analyst Robert Cozza, and rose 85%, year over year, on volume of shipments. He believes some consumers may have held off on smartphone purchases as they observed the flurry of product announcements for things arriving after Q1.

Both Apple (AAPL) and Google stand out as the big winners in the survey, no surprise.

Among the vendors, Nokia (NOK) led shipment volume, of course, with 25% market share and 107.6 million units, although that was down from a 30.6% share a year earlier, when Nokia sold 110.1 million units.

Samsung (SSNLF) was second with 16%, down from 18%, LG Electronics (LGERF) was third with 5.6%, down from 7.6, and Apple was fourth, with 3.9% share, up from 2.3%, helping it to vault ahead of fifth place Research in Motion (RIMM), whose share held steady at 3%.

In smartphones, where Gartner ranks by platform, rather than hardware vendor, Google’s (GOOG) Android topped the charts with 36% of smartphone sales, almost quadrupling, year over year. Symbian, sold by Nokia and others, had 27% share, way down form 44%, and Apple’s iOS software platform rose slightly from 15.3% to 16.8%. Gartner reiterated a view that the partnership between Microsoft (MSFT) and Nokia will “accelerate Windows Phone’s momentum,” with the platform having only 3.6% share of smartphones in Q1, down from 6.8% a year earlier.

Article courtesy of Tech Trader Daily