AAPL January 8

AAPL: 96.96

0.51
Stock Chart

Apple shares yesterday closed below $100 for the first time in 15 months, the WSJ noting that the value of the company has dropped by $100B in a little over a month, losing 7% this week alone.

The Cupertino company’s 4.2% drop on the day was greater than the overall market’s slide and the 3% slump in the Nasdaq Composite, which closed down 10% from its May peak. Since early December, Apple has shed $100 billion in market value.

The slide is being attributed to two factors: one (semi-)factual, one speculative …

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AAPL January 6

AAPL: 100.70

-2.01
Stock Chart

[Update 2Reuters reports that Foxconn has published an earnings report showing a 20% fall in December revenues. However, the company says that its December earnings were “as expected,” and its full-year earnings are up 6.42% on the previous year, only marginally short of analyst expectations of 7%.]

[Update 1: StreetInsider reports that Foxconn has denied reports that workers started their lunar new year holiday early, and says that the government payout relates to ‘an insurance premium,’ but makes no reference to any response to the claim that it has been laying off workers.]

The WSJ is today suggesting that Apple is scaling back iPhone orders, noting that iPhone manufacturer Foxconn has been laying off workers and has received a $12.6M subsidy from the Chinese government through a program designed to minimize unemployment.

The piece notes that the subsidy is for Foxconn’s Zhengzhou plant, which is mostly devoted to iPhone production, and says that Apple has also reduced order forecasts for iPhone component makers.

Chinese iPhone factories had some idle capacity in the final two months of the calendar year, when they would typically be racing to chongliang, or “rush quantity,” for Apple, in factory-speak. Some workers at Foxconn’s Zhengzhou factory in inland China were let go on early holiday last month, one of the people involved in the supply said, although the typical new-year holiday season doesn’t start until February.

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AAPL December 31, 2015

AAPL: 105.26

-2.06
Stock Chart

There have been a number of predictions that Apple will next year report a year-on-year decline in iPhone shipments for the current quarter, KGI among them. Most such reports are based on extrapolating from supply chain data which attempts to estimate production volumes.

These reports contrast with Apple’s own guidance for record revenue of $75.5B to $77.5B. Tim Cook argued in October that some two-thirds of existing customers are still using older phones, leaving plenty of room for upgrades this quarter, and that Apple is winning over Android owners in record numbers.

One analyst believes he knows how the conflict can be resolved…

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AAPL December 30, 2015

AAPL: 107.32

-1.42
Stock Chart

Apple, which was accused by the Italian government of failing to declare more than $1.3B of income when paying corporation tax in the country, has now agreed to pay the full €318M ($347M) claimed by the Italian tax office. The company has 16 Apple Stores in Italy.

Apple was accused of funnelling profits from Italian sales through its Irish subsidiary in order to benefit from the lower tax rate the company had agreed there. (Those tax arrangements are the subject of a separate EU investigation.)

La Repubblica (via The Local) reports Apple Italia was listed as a “consultant” for Apple Ireland, enabling the company to book profits through Ireland, paying just 2.5% tax under the terms of an agreement said to have first been reached with Steve Jobs back in the 1980s …

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AAPL December 14, 2015

AAPL: 112.48

-0.70
Stock Chart

The long-running investigation into the legality of Apple’s tax arrangements in Ireland has been expanded, with the European Commission now seeking additional information from the Irish government, reports the FT. This means that the investigation is likely to be extended well into next year. A ruling had originally been expected before the end of the year.

While Irish authorities had expected the case to be concluded soon, they have instead been sent bulky sets of supplementary questions, meaning it will be difficult to reach a final verdict until after the 2016 election, which is expected as early as February […]

The Irish finance ministry confirmed that the government was supplying the requested additional information to the commission. “We do not expect any decision until after the new year,” said a spokesman.

If the ruling goes against Apple, it could face a bill for billions of Euros in underpaid tax …

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AAPL December 8, 2015

AAPL: 118.23

-0.05
Stock Chart

Like many this morning, my first reaction to Apple’s Smart Battery Case was … what the heck? Albeit not expressed in those exact words. Seth tweeted that it seemed to be evidence that Jony Ive has left the building.

My colleague Jeremy has addressed the battery case specifically, but I think there’s a broader issue here. Apple claims to sweat the details when it comes to the design of its devices, and – a few grumbles aside – I think that’s a legitimate claim on the aesthetic front. It does go to obsessive lengths when it comes to making its devices as visually pleasing as possible. One part of that obsession is making iPhones as thin as it can.

But, to my mind, the company has an almost schizophrenic attitude here. It goes to all that trouble to make the phones as slim and sleek as humanly possible, yet it knows full well that the first thing the vast majority of owners do when they take delivery is to slip the phone into a case. Those cases substantially increase the thickness, and hide the design.

Which brings us to problem two …  expand full story

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