Bad Apples. Shock horror! Apple’s third-quarter sales fell a touch short of forecasts as sales of the new iPhone fell a bit short of estimates and the company went very tricky on sales figures for the Apple Watch. The share price dropped by around 7.5% (or a US$60 billion drop in market value). But it was the tap dancing around data for sales of the new watch that brought the company undone. The sales figures were buried in the “other” classification Apple uses to round up other revenues — that rose from US$1.77 billion a year ago to US$2.6 billion this year. Marketwatch said analysts were expecting US$1.84 billion in Apple Watch sales, so the reported figures suggest a shortfall in sales.
Apple’s chief financial officer, Luca Maestri, said the company won’t provide Apple Watch sales because “we don’t intend to provide insight that could help our competitors”. CEO Tim Cook repeated that line adding sales of the Apple Watch exceeded internal expectations, despite supply trailing demand. Cook then told the briefing Apple was relying on strong holiday demand for Apple Watch — he says Apple is “convinced” it’ll be a hot gift this year in the fourth quarter (Christmas, which is Apple’s first quarter). By the way, Apple did more than OK in the three months to June 27, reporting a 32.5% rise in quarterly revenue to US$49.61 billion, helped by 35% surge in sales of iPhones. Apple said net income rose to US$10.68 billion, from US$7.75 billion a year earlier. — Glenn Dyer
NFL cornucopia. No wonder the AFL and NRL are looking to boost TV rights in new broadcast contracts — they have seen the NFL’s rivers of gold and want some of that. According to a report on the ESPN website overnight, the NFL delivered each of its 32 teams hundreds of millions of dollars a year in income from sales of the TV rights and other sources. The data came from the legendary Green Bay Packers, which are owned by shareholders and not a single private owner (as all 31 other teams in the NFL are). That means the Packers’ reports are public. The latest reveals that each of the 32 teams received US$226.4 million from the NFL last year as part of revenue sharing from TV and other rights. The total for the 32 teams is US$7.3 billion, up from just over $US6 billion the year before, because the new TV deals with CBS, NBC, Fox, ABC/ESPN and NFL Network started in the 2014-15 season, which ended with this year’s Super Bowl in early February.
In the 2009-10 fiscal year, the league split a little more than US$3 billion among its 32 teams. In addition, the Packers said in their report they had local sales of just under US$150 million. That means the club had more than US$370 million to run itself in the 2014-15 season. The Packers made a profit of just over US$29 million, but will spend that and millions more (up to US$55 million) renovating their field in Green Bay, Wisconsin, where game-day temperatures can be well below zero. Part of those changes at the stadium will allow fans in boxes to open the windows — in sub-freezing temperatures? Idiots! — Glenn Dyer
Get Crikey FREE to your inbox every weekday morning with the Crikey Worm.
Asian values. Remember how Barnaby Joyce warned us that approving gay marriage might make us seem “decadent” to Asians? And Senator Erica Betz claimed Asians would be upset if we did it because they hadn’t approved gay marriage. The impression both men tried to portray is that the Asian countries are examples of moral rectitude. Well, are they? Japan is the second-largest market for Australian goods, and over the years the place has been a cesspit of corporate incompetence on a scale that would shame our masters of the universe. That’s a big statement, but consider what Toshiba, one of the bluest of blue chips in Japan, has just had to confess to — falsifying US$1.2 billion in profits for the past six years. Out went a handful of senior executives and board members, including the deputy chairman and the current president and CEO. A one-off perhaps? No, wait there’s more.
Who can remember the US$1.7 billion profit-falsifying and accounting scandal at the venerable Olympus company back in 2011 — a mess that was only found when the company hired a foreign CEO? Never again. Bloomberg went back through the archives and found seven other examples of huge accounting losses, cover-ups, occasional jail sentences, fines and, in one case, the responsible executives being acquitted 10 years after their bank. And it’s not just in Japan — similar frauds have been reported from other Asian countries. South Korea right now is learning of multibillion-dollar losses at Daewoo Shipbuilding and Marine Engineering on a number of dud contracts. A few years ago, Taiwan jailed a former president on corruption charges. And in Malaysia there’s a US$1 billion-plus scandal involving a state investment fund and the Prime Minister that won’t die or be covered up. So what do Joyce and Abetz really know about Asian rectitude? — Glenn Dyer