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☆ Apple forecasts another drop in revenue, proclaims iPhone production problems over
▼ + stars: | 2023-02-03 | by ( Stephen Nellis | ) www.reuters.com time to read: +5 min

For the just-ended quarter, Apple's profits missed Wall Street expectations for the first time since 2016, dragged down by iPhone sales falling for the first time since 2020. The stock was down about 2% after Chief Financial Officer Luca Maestri said that iPhone sales were likely to improve compared with the quarter ended Dec. 31. In an interview, Cook told Reuters that the production disruptions that plagued Apple's key quarter were now over. During its fiscal first quarter ended Dec. 31, Apple faced a wave of challenges that left Wall Street expecting lower sales. Apple said iPhone sales were $65.8 billion, down 8% from the year before and the first fall since 2020.

☆ U.S. jury finds Tesla and Musk not liable in case over take-private tweet
▼ + stars: | 2023-02-03 | by ( ) www.reuters.com time to read: 1 min

Feb 3 (Reuters) - A U.S. jury on Friday found Tesla Inc (TSLA.O) and CEO Elon Musk not liable in a securities fraud case over a tweet that he had lined up funding to take the electric car company private. Plaintiffs have claimed billions in damages and the decision also had been seen as important for Musk himself, who has aggressively fought any charges that he was guilty and defended his ability to tweet broadly. Reporting by Jody Godoy in California and Hyun Joo Jin in San Francisco Editing by Noeleen Walder, Peter Henderson and Matthew LewisOur Standards: The Thomson Reuters Trust Principles.

The reports renewed questions about global economic demand, the effect of higher interest rates and whether the market's January rally got ahead of itself. Apple, the world's largest publicly traded company, fell short of expectations, hurt by lower iPhone sales and production disruptions in China. Amazon said operating profits could fall this quarter due to lower demand, and Alphabet's online advertisers cut back their spend as well. Shares of the three companies dropped after the results were released and were expected to drag the market lower Friday following a euphoric rally Thursday. These three firms and Microsoft (MSFT.O), the four U.S. companies with trillion-dollar market values, have led the broad-market S&P 500 in 2023.

☆ Apple's lower iPhone sales drive first profit miss since 2016
▼ + stars: | 2023-02-02 | by ( Stephen Nellis | ) www.reuters.com time to read: +5 min

Apple sales fell 5% to $117.2 billion and were down in every part of the world in the quarter. Apple Chief Executive Tim Cook told Reuters that the production disruptions that plagued Apple's key quarter were now over. "I would point out that 8% is still a very severe headwind," Cook told Reuters. On top of supply chain problems for the iPhone, Wall Street analysts had expected iPhone sales to fall this year as part of a larger pattern in which the iPhone 14 family released last year sells more slowly after two straight years of strong sales of iPhone 12 and 13 models. Apple said iPhone sales were $65.8 billion, down 8% from the year before and below analyst estimates of $68.3 billion.

[1/2] Tesla vehicles are shown at a Tesla service center in San Diego, California, U.S., January 13, 2023. Tesla board Chair Robyn Denholm is a defendant in the lawsuit alongside Musk, Tesla and other directors. At the time of the tweets, Denholm led Tesla's audit committee, which oversees company controls meant to ensure compliance with securities law. Musk told the jury earlier this week he could have financed the potential deal from existing Tesla investors as well as a Saudi wealth fund. The "funding secured" tweet came as a surprise to him, as Goldman, which had long worked with Tesla, was not involved in the deal.

OAKLAND, Calif/BANGALORE, Jan 27 (Reuters) - Microprocessor giant Intel Corp (INTC.O) has stumbled badly at a time when smaller rival AMD and others are picking up speed. Intel still dominates the markets for PC and server processing chips, with a market share greater than 70%, tech research firm IDC calculated. "I don't think Intel is in a position yet to start recovering share" in the market, he said. Customers of processors cannot launch products if new chip designs are late, and Intel has stumbled on delivering its latest data-center chip, code named Sapphire Rapids. Worse for Intel, the benchmarks published by the two companies show that AMD's latest server chip outperforms Sapphire Rapids on "general purpose workloads", according to Bernstein analyst Stacy Rasgon.

REUTERS/Andrew KellyOAKLAND, Calif/BANGALORE, Jan 27 (Reuters) - Microprocessor giant Intel Corp (INTC.O) says it will regain its footing against AMD and other chip rivals which are gobbling up market share, but Wall Street is skeptical. That's a headwind for Intel and AMD, both of which are rolling out new chips, but Intel is facing a larger inventory correction. Intel still dominates the markets for PC and server processing chips, with a market share greater than 70%, tech research firm IDC calculated. Chipmaker shares were hammered across the board on Friday, but Intel led the decline, slumping by 10% while AMD lost 1.8%. AMD set to overtake Intel in market cap, again AMD set to overtake Intel in market cap, againReporting By Jane Lanhee Lee and Chavi Mehta; Editing by David Gaffen, Peter Henderson, Kirsten Donovan and Jonathan OatisOur Standards: The Thomson Reuters Trust Principles.

Jan 25 (Reuters) - Tesla Inc's (TSLA.O) aggressive price cuts have ignited demand for its electric vehicles, Chief Executive Elon Musk said on Wednesday, playing down concerns that a weak economy would throttle buyers' interest. However, Musk, who has missed his own ambitious sales targets for Tesla in recent years, said 2023 deliveries could hit 2 million vehicles, absent external disruption. He said he expected a "pretty difficult recession this year," but demand for Tesla vehicles "will be good despite probably a contraction in the automotive market as a whole." CYBERTRUCKThe company is relying on older products and Musk said its Cybertruck, its next new electric pickup truck, would not begin volume production until next year. Musk dismissed surveys that suggest his political comments on Twitter are damaging the Tesla brand.

☆ Musk says China rivals 'work hardest, smartest'
▼ + stars: | 2023-01-26 | by ( ) www.reuters.com time to read: +2 min

Elon Musk sees the toughest competition for Tesla in China, home of the company he expects "most likely to be second" in electric vehicles. Asked about Tesla's competition, Musk responded that he respected car companies in China, calling it the most competitive market in the world. "They work the hardest and they work the smartest," he said. Musk has praised Chinese workers and competitors before. He also said Chinese workers had been "burning the 3 a.m. oil" to keep Tesla's factories running during COVID lockdowns last year.

Jan 25 (Reuters) - Tesla Inc's (TSLA.O) aggressive price cuts have ignited demand for its electric vehicles, Chief Executive Elon Musk said on Wednesday, playing down concerns that a weak economy would throttle buyers' interest. Deep price cuts this month have positioned Tesla as the initiator of a price war, but its forecast of a 37% rise in car volume for the year, to 1.8 million vehicles, was down from 2022's pace. Musk, who has missed his own ambitious sales targets for Tesla in recent years, said that deliveries in 2023 could hit 2 million vehicles, absent external disruption. The company is relying on older products and Musk said its Cybertruck, its next new electric pickup truck, would not begin volume production until next year. Net profit for the quarter was $3.69 billion, or $1.07 per share, compared with $2.32 billion, or 68 cents per share, a year earlier.

Jan 25 (Reuters) - Tesla Inc's (TSLA.O) aggressive price cuts have created a wave of demand for its electric vehicles, Chief Executive Elon Musk said on Wednesday, addressing concerns that a weak economy would throttle buyers' interest. "These price changes really make a difference for the average consumer," he said, adding that demand was roughly double production in January and that sales in 2023 could hit 2 million vehicles, absent external disruption. Musk dismissed the suggestion that his political commentary on Twitter had become divisive or a problem for Tesla. "Tesla’s plans to rapidly scale up output will only stimulate profit growth if demand is there to meet it. Even a small cooling of demand will have significant implications for the bottom line," said Sophie Lund-Yates, an analyst at Hargreaves Lansdown.

Tesla forecast a 37% rise in car volume for the year, to 1.8 million vehicles. Reuters GraphicsTesla's sales prospects after a huge price cut early this year, facing a weak global economy, are a key focus for investors. But its recent, steep global price cuts mark a move toward stimulating growth at the expense of profit margins, underscoring softening demand. Net profit for the quarter was $3.69 billion, or $1.07 per share, compared with $2.32 billion, or 68 cents per share, a year earlier. Adjusted earnings per share of $1.19 topped the Wall Street analyst average of $1.13.

“The small miss on Microsoft’s cloud earnings forecast is likely just a reflection of the new economic reality that businesses are facing and not a harbinger of something worse," said Bob O'Donnell, chief analyst at TECHnalysis Research. It forecast third-quarter revenue in its so-called intelligent cloud business would be $21.7 billion to $22 billion, just below the analyst average forecast of $22.14 billion, according to Refinitiv. He said revenue from OpenAI-related businesses would show up in revenue for Microsoft's cloud service Azure in the future. Azure cloud product revenue in the second quarter rose 31%, in line with estimates compiled by Visible Alpha. The company expects that revenue to drop to $11.9 billion to $12.3 billion in the current fiscal third quarter.

But its recent, steep global price cuts mark a move toward stimulating growth at the expense of profit margins, underscoring softening demand. Tesla said its automotive operation margin was 25.9% in the fourth quarter, the lowest in two years. Net profit for the quarter was $3.69 billion, or $1.07 per share, compared with $2.32 billion, or 68 cents per share, a year earlier. Tesla ended 2022 with just over $22 billion in cash and cash equivalents. "Tesla’s plans to rapidly scale up output will only stimulate profit growth if demand is there to meet it.

Microsoft said its third-quarter intelligent cloud revenue would be $21.7 billion to $22 billion, while analysts forecast $22.14 billion. In the second quarter, Microsoft's cloud services business helped offset a slump in the personal computer market. Azure has also steadily grabbed market share from leader Amazon.com Inc's (AMZN.O) Amazon Web Services (AWS). Azure ended 2022 with 30% share in the cloud computing market, up from 20% in 2018, according to estimates from BofA Global Research. Microsoft's revenue rose 2% to $52.7 billion in the three months ended Dec. 31, compared with the average analyst estimate of $52.94 billion, according to Refinitiv IBES.

Musk ended three days on the stand defending against claims that he defrauded investors by tweeting on Aug. 7, 2018, that he had "funding secured" to take Tesla private. The trial in San Francisco federal court is testing whether the world's second-richest person can be held liable for his sometimes impulsive use of Twitter. Musk, however, acknowledged he did not have binding agreements with investors, leaving it to the jury to decide if he misled shareholders. The Saudi fund did not immediately respond to a Reuters request for comment. But when questioned by Nicholas Porritt, a lawyer for the investors, Musk said he did not have binding agreements for financing from any interested party.

Musk is defending against claims he defrauded investors by tweeting on Aug. 7, 2018, that he had "funding secured" to take Tesla private at $420 per share, and that "investor support is confirmed." He has testified that he chose not to take Tesla private due to a lack of support from some investors and a wish to avoid a lengthy process. A jury of nine will decide whether the Tesla CEO artificially inflated the company's share price by touting the buyout's prospects, and if so by how much. In addition, Musk testified on Monday that he met on July 31, 2018, with representatives of the Public Investment Fund at Tesla's factory in Fremont, California. Musk said the fund's governor, Yasir Al-Rumayyan, later backpedaled on the commitment to take Tesla private.

[1/5] Elon Musk attends the opening ceremony of the new Tesla Gigafactory for electric cars in Gruenheide, Germany, March 22, 2022. He added later that he chose not to take Tesla private due to a lack of support from some investors and a wish to avoid a lengthy process. Musk told the investors' lawyer Nicholas Porritt that he met on July 31, 2018, with representatives of Saudi Arabia's sovereign wealth fund, the Public Investment Fund, at Tesla's factory in Fremont, California. That never came to pass, Musk said, because the fund's governor, Yasir Al-Rumayyan, later backpedaled on the commitment to take Tesla private. "I was very upset because he had been unequivocal in his support for taking Tesla private when we met and now he appeared to be backpedaling," Musk testified.

"PIF unequivocally wanted to take Tesla private," he testified. Musk subsequently said that Yasir Al-Rumayyan, governor of the fund, later backpedaled on the commitment to take Tesla private. "I was very upset because he had been unequivocal in his support for taking Tesla private when we met and now he appeared to be backpedaling," Musk testified. Tesla's stock price surged after Musk's tweets, and later fell as it became clear the buyout would not materialize. Musk testified calmly, in contrast to his occasional combative testimony in earlier trials.

Tesla's stock price surged after Musk's tweets, and later fell as it became clear the buyout would not happen. A jury of nine will decide whether the billionaire artificially inflated Tesla's share price by touting the buyout's prospects, and if so by how much. "It was chosen because it was a 20% premium over the stock price," he testified. Musk testified calmly, in contrast to his occasional combative testimony in earlier trials. The defendants also include current and former Tesla directors, whom Spiro said had "pure" motives in their response to Musk's plan.

Companies Tesla Inc FollowTwitter Inc FollowJan 23 (Reuters) - Tesla Chief Executive Elon Musk will take the witness stand again on Monday, as he defends himself against fraud claims that he lied when he tweeted in 2018 that he had funding to take the electric carmaker private. Millions of dollars are at stake as well as the reputation of Musk, whose personal stature is a central asset of the Tesla brand. The trial will test whether Musk's penchant for taking to Twitter to air his sometimes irreverent views misleads investors and damages the value of the company. Shareholders claim they lost millions after Musk tweeted that he had "funding secured" to take Tesla private. The defendants include current and former Tesla directors, whom Spiro said had "pure" motives in their response to Musk's plan.

He called it the most democratic way to communicate but said his tweets did not always affect Tesla stock the way he expected. "Just because I tweet something does not mean people believe it or will act accordingly," Musk told the jury in San Francisco federal court. [1/5] Tesla CEO Elon Musk testifies during a securities-fraud trial in San Francisco, California, U.S., January 20, 2023 in this courtroom sketch. Earlier on Friday, Tesla investor Timothy Fries told the jury that he lost $5,000 buying Tesla stock after Musk sent the tweet, which sparked volatile swings in Tesla's stock. Musk's attorney, Alex Spiro, told the jury in his opening statement Wednesday that Musk believed he had financing from Saudi backers and was taking steps to make the deal happen.

☆ U.S. airlines sound bullish on travel demand despite recession risk
▼ + stars: | 2023-01-18 | by ( Rajesh Kumar Singh | ) www.reuters.com time to read: +3 min

CHICAGO, Jan 18 (Reuters) - U.S. airlines on the back of strong financial results remain upbeat about travel demand, even as economists and analysts say the risk of an economic recession has gone up. United Airlines (UAL.O) and Delta Air Lines (DAL.N) reported higher-than-expected quarterly earnings on resilient consumer demand, while American Airlines (AAL.O) lifted its profit outlook. Carriers are enjoying the strongest travel demand since the start of the COVID-19 pandemic, boosted by reopening of closed borders, a strong U.S. dollar and rising corporate travel. While recession fears have sparked concerns about consumer spending, airline executives say travel demand is not likely to wane any time soon. United estimates domestic passenger revenue previously accounted for about 0.5% of the country's gross domestic product.

Tesla investor Glen Littleton is seeking damages on behalf of shareholders who traded the company's stock in the days after Musk posted his plan to take the company private on Twitter in August 2018. Musk's lawyer disputed this characterization, saying that the billionaire was "serious" about taking the company private in 2018, but ultimately encountered shareholder opposition. Musk believed that financing was not an issue and was "taking steps" to make a deal happen, Spiro told the jury. The self-employed investor said he viewed Musk's "funding secured" statement as "absolute." Spiro said on Wednesday that Tesla's stock price jumped in response to Musk saying he was considering taking the company private, which he said was true.

SAN FRANCISCO, Jan 18 (Reuters) - A lawyer for Tesla Inc (TSLA.O) investors said on Wednesday that CEO Elon Musk "lied" when he tweeted in 2018 that funding was "secured" to take the company private. Musk's alleged lies caused "regular people" to lose millions, Nicholas Porritt, lead attorney for the investors, told a jury in San Francisco during opening statements. Musk's lawyer disputed this characterization, saying that the billionaire was "serious" about taking the company private in 2018, but ultimately encountered shareholder opposition. Tesla investor Glen Littleton is seeking damages on behalf of shareholders who traded the company's stock in the days after Musk posted his plan to take the company private on Twitter in August 2018. Reporting by Jody Godoy in San Francisco Editing by Peter Henderson, Noeleen Walder and Matthew LewisOur Standards: The Thomson Reuters Trust Principles.

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