Apple has just alerted the media that it plans to discuss what the company will do with its $100 billion in cash tomorrow at 9:00 AM ET. The most logical assumption is Apple will issue a dividend to shareholders. Or buy part of Samsung or something crazy. Press release follows.
Apple reported a monster first quarter last Tuesday that sent the company’s stock skyrocketing over the past week. Apple’s holiday quarter was the most profitable quarter ever reported by a technology company, and the second most profitable quarter reported by any U.S. firm. With a market capitalization that now sits in excess of $420 billion, Apple is currently the most valuable company in the world, and with more than $97.6 billion in cash and cash equivalents at the end of calendar 2011, Apple has amassed an unbelievable war chest that is unrivaled among its competitors. Business blog MBA Online recently put together an infographic to help us visualize just how big Apple has grown since it teetered on the brink of bankruptcy in the late 90s. Among the graphic’s bullet points are the facts that Apple’s year-end cash pile is enough to buy an iPad for each and every person living in Canada and Greece combined, and it’s also enough to pay off the entire public debt of eight countries within the European Union. The site’s full infographic follows below. More →
T-Mobile USA has been setting aside cash that it plans to use in an effort to keep its top employees on board should AT&T’s proposed $39 billion takeover of the firm gain U.S. regulatory approval. The carrier has reportedly already recorded $64 million in merger-related employee costs during the past two quarters. A spokesperson for T-Mobile’s parent company Deutsche Telekom confirmed to The Wall Street Journal that T-Mobile USA is indeed saving money to keep “top employees on board” after the deal closes. AT&T originally said the deal would close by March 2012, however it recently pushed that date back after the U.S. government filed a lawsuit in an effort to block the acquisition.
Samsung recently kicked off its “Time to Tab” video contest in which it’s giving away $15,000 in cash prizes. All you have to do is film a 60-second clip about how the Galaxy Tab 10.1 makes your life (or someone else’s life) better, or how you use the device during a 24 hour period. The top prize is $7,000, but you can also win $500 prizes for sharing videos about the competition. We could think of worse ways to win money More →
Earlier this month we heard reports from TechCrunch that TweetDeck had been acquired by Twitter for $50 million. CNN now says that Twitter has finalized its purchase of TweetDeck in a $40 million cash and stock deal, and that the paperwork was signed on Monday. Neither Twitter nor TweetDeck have confirmed the purchase, and Twitter’s PR team tweeted: “For all those who might be curious, we continue to not comment on rumors.” More →
Giddy over Apple’s consistent staggering growth — and seemingly giddier over the iPad — Formula Capital managing partner James Altucher believes that Apple is poised to become the first $1 trillion company. In fact, Altucher thinks Apple could already be a $2 to $3 trillion company. According to Altucher, Apple can basically do no wrong — he believes demand for the iPad 2 will continue to grow and then new products like the iPhone 5 and iPad 3 will send demand for Apple devices through the roof. He goes on to state that Jobs’ eventual departure from the company won’t even have a significant impact on Apple’s future, as many analysts expect, thanks to other great innovators within Apple such as Tim Cook. Apple’s market capitalization is currently around $320 billion, so its stock price would have to balloon to about $1,000 for Apple to hit $1 trillion. Hit the break for an enthusiastic Altucher talking up Apple in an interview with Business Insider. More →
Reuters is reporting that Samsung Electronics has agreed to sell its hard drive business to Seagate Technology for $1.4 billion in cash and stock. The move is seen as two pronged: first, it will allow Samsung to exit an extremely competitive market and refocus its efforts on its successful memory-chip business. Secondly, it will allow Seagate to be more competitive with Western Digital — a company that has announced its intentions to purchase Hitachi’s hard-drive business for more than $4.3 billion. “The transactions and agreements significantly expand Seagate’s customer access in China and Southeast Asia,” reads a statement released by both companies. The deal will see Samsung become the second largest shareholder in Seagate — with a nearly 10% share worth over $687 million — and the assets should be transfered sometime in 2011. More →
Aside from announcing a management change during this afternoon’s earnings call, Google also decided to go over its numbers for Q4 of 2010. Google raked in $8.44 billion in revenue, a 26% increase year-over-year, rewarding its investors with $7.81 earnings per share. Operating income for the quarter was $2.98 billion, or 35% of revenues — down from 37% last year — and 52% of total revenues came from overseas. Google reports $35 billion in cash, cash equivalents, and marketable securities along with 24,400 full-time employees as of December 31, 2010. Pretty solid showing from the Big G. More →
Last month, we reported on the short-term liquidity problems on the horizon for WiMAX network operator Clearwire, and today, the company has announced measures aimed at rectifying its current situation. Clearwire plans to raise over $1.1 billion through the sale of debt securities in “private placement transactions.” As the press release reads:
Clearwire Communications is offering $175.0 million first-priority senior secured notes due 2015, $500.0 million of second-priority secured notes due 2017 and $500.0 million of exchangeable notes due 2040 and will grant the initial purchasers of the exchangeable notes an option to purchase up to an additional $100.0 million of exchangeable notes.
The securities will be offered to “qualified institutional buyers” only and note-holders will be paid-out in either cash or stock once the paper hits maturity. Recently, the “4G” network operator cut close to 15% of its workforce in order to conserve cash.
U.S. wireless provider Sprint — whose WiMAX enabled devices run on Clearwire’s airwaves — owns 54% of the network operator. Sprint declined to comment on the planned sales. More →
The Wall Street Journal is reporting that U.S. wireless providers AT&T, T-Mobile, and Verizon Wireless are working on a joint project that aims to bring a mobile-phone payment system Stateside. Purportedly, the effort is being headed by General Electric executive Michael Abbott and will be financed by Barclays PLC and Discover Financial Services.
“The rare showing of cooperation between three of the four national carriers creates a potentially large base of users for its mobile-payment system,” writes the Journal. “The carriers are eager to move into mobile transactions because it represents a new revenue stream and another feature that gets subscribers spending more time on their phone.”
The report goes on to note that the announcement of the new service’s existence could come as early as today. Mobile payments systems have been in use in Canada and Europe for several years. More →
Today, during their Q3 2010 earnings call, WiMAX network operator Clearwire announced that it would be slashing 15% of its workforce and instituting several “cash conservation measures” in an attempt to raise “short-term funding.” As the earnings brief reads:
While the Company is cautiously optimistic it will resolve its short-term funding needs in the near future, there can be no assurances. Thus, it is implementing a series of significant cash conservation measures to reduce costs, including: a substantial reduction in sales and marketing spending, a suspension of additional retail channel market launches of the CLEAR-branded operations in select markets including Denver and Miami, delays in the introduction of CLEAR-branded smartphones, a substantial reduction in the contractor workforce, a 15% reduction in the number of employees, and the discontinuation of development activities for sites not required for its current build plan. The Company currently has thousands of sites in various stages of planning and construction beyond its current build plan, and it intends to suspend zoning and permitting in a portion of those sites until such time as additional funding becomes available. These contemplated initiatives are intended to result in potential cost savings of between $100 million to $200 million in 2010 and again in the first half of 2011.
That certainly doesn’t sound good. We contacted Sprint for comment — as their 4G network depends on Clearwire — and they were kind enough to provide us with a statement. Hit the jump to read Sprint’s take on Clearwire’s situation. More →
Today, AT&T and Nokia announced the “Calling All Innovators” contest for developers. The contests goal is to get more North American-centric applications into the Nokia ecosystem. Oh, and if your application happens to be picked by AT&T and Nokia as a winner… there is a cool $10 million in cash and prizes waiting to be given out. “Developers have until January 28th, 2011, to submit their applications in more than 17 categories. [...] Category prize winners receive USD 150K each for a total of USD 4 million and grand prize winners receive an additional USD 100K each. Although submissions must be relevant for the North American consumer, developers from around the world can participate.” So, if you’ve got some ill development skills, and want to take a swing at Qt, here is your chance to be paid for your efforts. Good luck. More →
Today, Intel announced that it would purchase antivirus maker McAfee for $7.68 billion in cash. The deal will see McAfee shareholders paid out at $48 per share, a 60% premium on the stocks current $30 price tag. Intel CEO Paul Otellini had this to say: “In the past, energy-efficient performance and connectivity have defined computing requirements. Looking forward, security will join those as a third pillar of what people demand from all computing experiences.” Intel and McAfee were advised by Goldman Sachs and Morgan Stanley respectively. More →