Large tech firms are coming under scrutiny over their tax avoidance measures, following the testimony of Apple executives to a US Senate Permanent Subcommittee. Google, Yahoo, Cisco, and others have been found to be using an assortment of tax loopholes and off-shoring in order to avoid paying governments in the US and Europe at least $100 billion.
Samsung has bought a 10 percent stake in South Korea-based mobile producer Pantech. The purchase of shares in the country's third-largest smartphone manufacturer, reported to be worth 53 billion won ($47.6 million), will make Samsung the third-largest stake holder, just behind Qualcomm and the state-owned Korea Development Bank.
Apple has posted the opening statements two of its executives -- CEO Tim Cook (PDF) -- and CFO Peter Oppenheimer (PDF) -- made during their testimony in front of the US Senate earlier today. The documents don't reveal anything new, but do constitute a record of Apple's stance during the Senate hearing. "We pay all of the taxes we owe -- every single dollar. We not only comply with the laws, but we comply with the spirit of the laws," Cook's statement reads.
In the wake of Apple's published testimony, US Senators Carl Levin (D-MI) and John McCain (R-AZ) have released their own joint statement on the work of the Senate Permanent Subcommittee on Investigations. "Apple Inc. has used a complex web of offshore entities -- including three foreign subsidiaries the company claims are not tax resident in any nation -- to avoid paying billions of dollars in U.S. income taxes," Levin's office writes.
A day ahead of CEO Tim Cook's planned appearance in front of the US Senate, Apple has published its official testimony (PDF) for the Senate Permanent Subcommittee on Investigations. In the document, the company lobbies for corporate tax reform, specifically arguing that the government should be "revenue neutral, eliminate all corporate tax expenditures, lower corporate income tax rates; and implement a reasonable tax on foreign earnings that allows free movement of capital back to the US." Apple has roughly $100 billion in overseas cash, which it has refused to repatriate unless it can pay less than the standard 35 percent tax rate.
Yahoo has confirmed it has bought Tumblr, in a deal noted yesterday to be in the region of $1.1 billion. The search company has already moved its company blog over to the blogging platform, and despite CEO Marissa Mayer saying "We promise not to screw it up," there is reportedly a large jump in the number of users moving from Tumblr to Wordpress.
Yahoo is holding a "product-related" event on May 20. The New York City event will see CEO Marissa Mayer speaking on an undisclosed topic for about an hour at 5PM EST, which the company calls in an mass email "something special."
Yahoo is in discussions to acquire or work with blogging service Tumblr, according to reports. The talks between the two companies are, depending on the report, concerning a possible strategic alliance between the two or an outright purchase of Tumblr, with the search engine said to be offering as much as $1 billion.
The Superior Court of Mexico has overturned a lower court ruling that found Yahoo liable for $2.75 billion in damages. Plaintiffs Ideas Interactivas and holding company Worldwide Directories sued Yahoo over breach of contract and lost profits on a yellow pages service.
Dell today announced fiscal 2014 first quarter results, with revenue of $14.1 billion, as the company grew revenue from Enterprise Solutions, Services and Software 12 percent year over year to $5.5 billion, or 8 percent growth, excluding the recent acquisition of Quest Software. The company earned $0.21 per share, not quite meeting Wall Street estimates.
Ahead of the Apple CEO's US Senate testimony, Tim Cook has replied to questions about politics and Apple's offshore tax practices in a new Politico interview. "We don't have a large presence in Washington, as you probably know, but we care deeply about public policy and believe creative policy can be a huge catalyst for a better society and a stronger economy," he says.
Apple is today paying out its latest dividend to shareholders. The amount is rated at $3.05 per share, translating into a total of about $2.867 billion for all of the company's 940 million outstanding shares. To be eligible for the dividend, a person must have been a shareholder by May 13th; because qualifying purchases must be settled though, realistically, any stock must have been bought no later than the 8th.
Apple will be the focus of a US Senate hearing next Tuesday, Politico says it has learned. The company's CEO, Tim Cook, is expected to testify in front of the Senate Permanent Subcommittee on Investigation regarding offshore tax practices. Other witnesses are also expected to speak, such as representatives from the Treasury Department and the IRS.
Apple and Google both passed important financial milestones during Wednesday trading, notes The Next Web. While Apple's market value has fallen under $400 billion, Google's value has climbed over $300 billion. The surge in the latter company's worth is being linked to today's Google I/O keynote, where the company showcased several new products, services, and features, such as unified messaging and a Galaxy S4 with stock Android.
Troubled electronics manufacturer Sharp has reportedly had its largest yearly net loss in its century-long history. The losses of 545 billion yen ($5.3 billion), which is higher than any other result in its last 100 years of doing business, with management at the company also seeing a reshuffle in another attempt to rectify its finances.
A pair of contradictory reports have surfaced today, regarding the potential sale of HP's troubled acquisition Autonomy to German software powerhouse SAP. Initially, the Times of London reported that HP had tried to sell the company to SAP, but a follow-up report from HP refutes all reports, with backup by SAP saying that an executive had a quote given in an interview misinterpreted by the UK paper.
Investor Carl Icahn and Southeastern Asset Management have proposed a new offer to Dell shareholders, who are considering a proposal by founder Michael Dell's group of investors, including Microsoft, to purchase existing shares at $13.65 each in order to take the company private. In a letter to Dell's board of directors, Icahn and Southeastern are counter-proposing a deal to give all Dell shareholders the option to retain shares in the company, plus take an additional $12 a share in cash or stock.
Graphic card producer Nvidia today reported revenue for the first quarter of the company's fiscal 2014, which ended April 28. The company report income of $954.7 million, down 13.7 percent from $1.11 billion in the fourth quarter of fiscal 2013. The company posted a $77.9 million profit, with earnings per share of $0.13, down 53.6 percent from $0.28 in the prior quarter. The results beat Wall Street expectations for the quarter, and the company expects to return to growth later in the year, on the strength of the margins on the Kepler GPU chipset and the release of the Tegra 4 system-on-a-chip.
YouTube has announced that is is opening a program for a "small group" of providers who will offer a subscription service of video content starting at $1 per month, but averaging overall just over $3 per channel. Starting today, partners such as Sesame Street, UFC, National Geographic, Jim Henson and the rest of the test channels will offer paid content with a 14-day free trial.
Crowdsourced traffic and navigation app service Waze may be acquired by Facebook, according to a report. The discussions between Waze and Facebook come months after a possible acquisition offer from Apple and appears to be reaching the same financial levels as the billion-dollar Instagram deal in April last year.
The makers of Ouya, the Android-based game console, has received extra funding from investors ahead of its launch. The additional outside investment has now allowed Ouya to set the date of the official public launch as June 25, allowing more time for it to manufacture consoles before shipping units to retailers.
Reports have surfaced that Microsoft is allegedly offering $1 billion to buy the digital assets of Nook Media, Barnes & Noble's venture into e-book publishing. Under the terms of the deal, Microsoft would redeem preferred units in Nook Media, which would give control of the operation to Microsoft.
Apple's Peter Oppenheimer was the highest-paid chief financial officer during 2012, according to Bloomberg. The executive received compensation worth a theoretical $68.6 million, roughly 16 times what Apple CEO Tim Cook received for the year. By comparison, Oppenheimer's closest competition -- Oracle CFO Safra Catz -- was given $51.7 million, while Google CFO Patrick Pichette was granted $38.7 million.
T-Mobile USA's first quarterly results of the year appears to show its Uncarrier campaign is working in attracting prepaid customers, though still lost high-earning postpaid accounts. Despite adding more customers overall, revenues for the quarter hit $4.68 billion, a drop of seven percent compared to $5.03 billion received for the same quarter last year.
In Greenlight Capital Investor's quarterly earnings conference call, Chairman David Einhorn revealed that he has grown his stake in the company. The move was made in reaction to Apple's announcement of the $100 billion share repurchase, and record-breaking dividend program which he called "a major step forward" for the Cupertino manufacturer.
Frequent litigant Aaron Greenspan, one-time claimant to Facebook co-foundership has filed a lawsuit against the vast majority of Silicon Valley's largest investors, and many Internet companies offering "money services businesses" with cash transfers as a primary product. The list of corporate defendants include frequent Greenspan target Facebook, Airbnb, Dwolla, and Square, troubled BitCoin exchange Mt. Gox, and many others. Individuals named in the suit inlude Paypal founder Max Levchin, Airbnb creator Brian Chesky, billionaire Yuri Milner, and Reddit CEO Yishan Wong.
Microsoft has extended its revenue guarantee with Yahoo, according to an SEC filing. The revenue-per-search guarantee, part of the ten-year deal the two companies struck in 2009, will be extended by one additional year, allowing Yahoo to earn more revenue than it otherwise would have if the guarantee fully elapsed.
SoftBank's CEO is continuing to talk-up his company's $20.1 billion offer to buy out Sprint, by claiming SoftBank's experience with 4G will help the US carrier. Network enhancements, such as SoftBank's single frequency network technology for reducing interference, will help Sprint in the long run alongside other benefits, according to CEO Masayoshi Son.
Samsung is steadily improving its profitability in the smartphone area, but Apple continues to be the dominant player when it comes to making money on smartphones sales according to the latest report from Canaccord Genuity. Apple's lower profit margin on smartphones in the first calendar quarter of the year led to a significant drop in its share of smartphone profits but was enough to allow the iPhone maker to claim 57 percent of the entire industry's profits, with Samsung taking the remaining 43 percent.
Asus managed to sell 3 million tablets in the first quarter, offsetting a drop in sales of notebooks and computer parts, according to the company's latest quarterly results. Overall, the company managed to earn $3.5 billion in revenues for the quarter, with its $202 million quarterly profit an improvement compared to both year-on-year and the previous quarter by 5.8-percent.
Apple's $17 billion bond sale -- meant to help finance a $55 billion stock buyback, part of a plan to return $100 billion to shareholders by 2015 -- is saving the company about $9.2 billion in taxes, according to an estimate from Moody’s Investment Services. Had Apple decided to use repatriated foreign cash, it would have paid a 35 percent tax rate, and hence owed the US about $9.2 billion.
The Securities and Exchange Commission has approved the proposal from SoftBank to buy out Sprint. While shareholders in the US carrier are expected to discuss and vote on the deal at a meeting next month, the chairman of Dish Network has made comments against the proposal, citing the need for Sprint's network to be upgraded by US teams.
The current chief operating officer of Intel will become the chief executive officer of Intel on May 16th, according to an announcement from the board of directors. Brian Krzanich will take over from the outgoing Paul Otellini, and will become the sixth CEO in the company's history, while Renée James has been elected to be the president of Intel on the same date.
A pair of Japanese banks are considering a 100 billion yen ($1 billion) bailout loan to Sharp, to help it meet an upcoming bond redemption. The electronics manufacturer has nearly $2 billion in convertible bonds, similar to Apple's current offering, maturing in September. Lenders Mizuho Corporate Bank and Bank of Tokyo-Mitsubishi UFJ are also giving Sharp an extension on 360 billion yen in lending that matures in June. The offerings by the banks puts Sharp in the red to the two banks to just over $8 billion.
Social network Facebook has posted its quarterly earnings report, with results that have slightly exceeded Wall Street expectations. The company had total revenues of $1.46 billion generated from 665 million daily active users on the average. Net income came in at $219 million, with the company earning $0.13 per share with a 26 percent operating margin.
Eastman Kodak has filed its latest plan to exit from Chapter 11 bankruptcy that gives ownership of the venerable company to unsecured creditors and bond holders. Second-lien note holders will receive 85 percent of common stock in the company, worth nearly $374.85 million. Unsecured creditors will be awarded the remaining 15 percent of shares.
T-Mobile USA and MetroPCS have now completed their merger, and are now one company. The formation of the new entity, known as T-Mobile US and trading on the New York Stock Exchange under the ticker symbol TMUS, comes one week after MetroPCS shareholders voted to approve the merger after some improvements, a process which started in October last year.
For the second year in a row, Apple CEO Tim Cook will be the featured interviewee on the opening night of the AllThingsD D11 conference, being held in San Francisco on May 28-30. Last year's interview with Cook, at the D10 conference, was his first formal interview at a third-party event not closed to investors. The opening-night spot is highly coveted and usually reserved for an extensive conversation. In his previous one-hour talk, Cook answered pointed questions on the patent system, Apple's legal fights and his relationship with former CEO Steve Jobs.
The richest man in Russia, Alisher Usmanov, recently bought $100 million in Apple shares, Bloomberg reports. While cautioning that "nothing is eternal," he argues that Apple is a "very promising investment" for the next three years, pointing to the company's plan to return $100 billion to shareholders by 2015. Usmanov's $19.8 billion fortune is based mainly on two websites, Alibaba and Mail.ru, as well as a Facebook investment that yielded over 10 times his initial input.
(Updated with order book rumors, value of bonds) Apple's planned bond sale involves a six-part offering, according to a filing discovered by Bloomberg. Some floating-rate notes are set to mature in 2016 and 2018, while fixed-rate securities are due in 2016, 2018, 2023, and 2043. The filing confirms Goldman Sachs and Deutsche Bank as the institutions managing Apple's sale.
Electronics retailer Best Buy is selling its stake in Carphone Warehouse Group to co-owner Carphone Warehouse, in its continued efforts to financially turn itself around. The sale, which sees Best Buy exchange its holdings in the European entity for £500 million ($774 million) in cash and stock according to a statement, effectively ends Best Buy's faltering expansion into the continent.
The CEO of SoftBank believes there is no need to change the Japanese carrier's offer to Sprint, following a secondary offer from Dish Network. Masayoshi Son, also the founder of the company, told the audience of an earnings briefing "There is absolutely no need for that since we believe our offer is above theirs."
Apple is taking steps towards offering its first-ever bond sale, Reuters reports. A source tells the newswire agency that the company is making investor calls to Goldman Sachs and Deutsche Bank today, and has filed paperwork for a debt offering with the US Securities and Exchange Commission. The sale will go towards funding the company's plan to return $100 billion in cash to shareholders by 2015.
Apple's recent "partial backtrack" on a plan to deprecate the "always on" feature in its implementation of VPN could indicate possible negotiations with VirnetX, which won a $368 million District Court ruling that Apple was violating its patents. However, new information discovered by Computerworld in an SEC Form 10-Q filing suggest that Apple is also be preparing to appeal the ruling. Documents filed by the iPhone maker say it will not yet record the court's award as a loss, because the company "is challenging the verdict."
Apple's plan to take out a loan for its $60 billion stock buyback is about saving taxes, notes the Washington Post. Although the company has $145 billion in cash reserves, roughly two-thirds of that is situated outside the US, and Apple has so far avoided repatriating the money in order to bypass a 35 percent tax rate. Taking out a loan for $60 billion means the company must still pay interest, but this is offset by not having to pay out dividends on the shares it's reclaiming.
US District Court Judge James Robart of the Western District of Washington has issued a critical ruling in the Motorola Mobile versus Microsoft patent lawsuit. The judge has decreed that Motorola Mobility is entitled to nearly $1.8 million per year from Microsoft for use of its standards-essential H.264 video playback and 802.11 Wi-Fi patents, a far cry from the $4 billion annually Motorola and its parent company Google demanded at the beginning of the lawsuit.
Yahoo has announced that Chairman of the Board Fred Amoroso is resigning. The former IBM executive will remain on the board of directors until the annual shareholder meeting on June 25. The chairman position will be filled by Maynard Webb, Jr. temporarily until a new director is found.
According to Facebook, the company has just acquired cloud coding company Parse, giving it a platform for back-end tools for mobile developers. Facebook calls the size of the deal "not material" to the acquisition, but reports place the deal between $80 and $95 million. Parse ownership claims that it had many corporate suitors, but chose Facebook because the social network fit the ethos of the startup better than the other companies involved.
Samsung Electronics today announced quarterly revenues of 52.87 trillion won ($47.6 billion) for the first quarter ended March 31 -- a six percent decrease from the previous quarter. Consolidated operating profit for the quarter reached 8.78 trillion won ($7.9 billion), representing a one percent decline quarter-over-quarter. Samsung estimates revenues would hit 52 trillion won ($46.8 billion) with operating profit of 8.7 trillion won ($7.8 billion) in this last quarter.
Amazon today announced financial results for its first quarter that ended March 31. The company reports that net sales increased 22 percent to $16.07 billion in the first quarter, compared with $13.18 billion a year ago. Despite the increased sales, net income decreased 37 percent to $82 million in the first quarter, or $0.18 per share, compared with $130 million, or $0.28 per share in the first quarter of 2012.
