The Breaking Point? APPLE Faces First Profit Drop in Decade, Obama Seeking to End Business Tax Breaks, Global Unemployment to Hit Record, And Investment Banking On The Brink
January 22nd, 2013
APPLE Faces First Profit Drop in Decade; IPhone Slows
Apple Inc. Chief Executive Officer Tim Cook is feeling the heat.
Eighteen months after taking over from Steve Jobs, Cook is facing rising production costs, competition from Samsung Electronics Co. and slowing growth in smartphones, threatening profits for the world’s most valuable company.
An earnings report tomorrow may show that fiscal first- quarter net income slipped 2 percent to $12.8 billion, or $13.48 a share, according to analysts’ estimates compiled by Bloomberg. That would be the first drop since 2003. In all except one quarter since that same year, profit has jumped more than 10 percent. Analysts project sales will rise 18 percent to $54.8 billion, the slowest growth rate since 2009.
Apple’s shares have dropped almost 30 percent since September, erasing about $190 billion in market value, on concern that demand for iPhones and iPads is ebbing. Cook, 52, overhauled most of the company’s product line ahead of the holiday shopping season, and results for the period will show for the first time whether the effort paid off.