Apple claims bitten by the stronger greenback. Apple has posted poor results, and boss Tim Cook had a ready explanation for the weak performance — the stronger greenback. He blamed currency swings, particularly the strength of the US currency, for more than US$5 billion in lost sales in the December quarter and went so far as to include a chart of the dollar in its earnings report on Tuesday. It claimed that every US$100 million worth of international sales earned in September 2014 was worth roughly US$85 million by the end of 2015 as it translated foreign currency revenues generated abroad back into dollars. Apple said the 10% slide in the euro last year caused the most damage.
Still, “poor little Apple” still ended up with US$216 billion in cash at the end of the quarter (no complaints about foreign currency impacts there) from US$205 billion at the end of September quarter. The worrying points: While Apple’s sales in China rose a solid 14% year-over-year to US$18.37 billion, both Japan and the Americas recorded falls — Americas down 4%. And the biggest shock: Apple is anticipating revenue for the current quarter between US$50 billion and US$53 billion. That would be a notable decline from US$58 billion for the March quarter of last year. — Glenn Dyer
Poor Mitch. Communications Minister Mitch Fifield sounds awfully confused. Earlier this week he was quoted in the media as describing the television industry’s $153 million annual fees to the federal government as a “super profits tax”, which no may longer be appropriate for the challenged free-to-air industry. Fifield hinted that radio licence fees could also be cut after reviews by his department. And yet the fees are not a tax on profits, they are a gross earnings-based tax on the private broadcasters using a public asset — electronic spectrum. TV and some of the radio companies have never paid an upfront cost to buy or lease the spectrum they use in their broadcasting (unlike telcos and others who were forced to bid for and pay the spectrum abandoned by the broadcasters in the move from analogue to digital broadcasting.
That $153 million is half the original fee of 9% of revenue and was halved by the Gillard Labor government. But weak revenue growth (caused by the rise of digital rivals for ad revenues and streaming services such as Netflix and smartphones) has hobbled the industry, along with dud management and programming decisions at Ten. Nine nearly went broke, and Seven continues to labour under more than $900 million in debt and weak profits. Yes, the likes of Netflix and Google don’t pay the fee, but that’s because they broadcast over the internet, not over electronic spectrum as Seven, Nine and Ten do (when it uses its satellite side). — Glenn Dyer.
Turkey cars. US car makers will be forced to recall an additional 5 million vehicles fitted with Takata Corp airbags after a driver died in a Ford pickup truck accident last month, according to a statement from regulators on Friday. The latest action brings the total recalled vehicles with potentially rupture-prone Takata airbags to more than 24 million. Before the Ford recall, most of the vehicles were made by Honda. In some cases, vehicles contain both driver-side and passenger-side airbag inflaters that must be repaired, meaning the total number of actual airbag repairs is around 28 million. The Ford recall is the latest in what has been a year or more of massive recalls by car companies. Last year millions of vehicles were recalled, with Chrysler Automobiles, Honda, GM, Toyota and Ford topping the list.The National Highway Transport Safety Association reported 51 million cars were ordered to be recalled in 2015. It pointed out that on average a quarter of the recalled vehicles were not repaired. Fiat, Honda, Ford, Toyota and GM vehicles represented 72% of cars and trucks involved in US recalls last year. — Glenn Dyer