Key Developments: Apple Inc (AAPL.O)
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Latest Key Developments (Source: Significant Developments)
Apple Inc's Stateless Subsidiaries Lower Tax Bills- Senate Report-Reuters
Reuters reported that using an unusual global tax structure, Apple Inc has held billions of dollars in profits in Irish subsidiaries to pay little or no taxes to any government, a U.S. Senate report on the Company's offshore tax structure concluded on May 20, 2013. In a 40-page memorandum released a day before Apple CEO Tim Cook is scheduled to testify before Congress, the Senate's Permanent Subcommittee on Investigations identified three subsidiaries that have no "tax residency" in Ireland, where they are incorporated, or in the United States, where company executives manage those companies. The subsidiary, which has a Cork, Ireland, mailing address, received $29.9 billion in dividends from lower-tiered offshore Apple affiliates from 2009 to 2012, comprising 30% of Apple's total worldwide net profits, the report said. Apple has exploited a difference between Irish and U.S. tax residency rules," the report said. Ahead of Tuesday's hearing, Apple said on Monday it does not use "tax gimmicks" and that the Company will pay more than $7 billion in U.S. taxes in fiscal 2013. Apple defended the main subsidiary highlighted by the subcommittee's report, saying it does not reduce Apple's U.S. tax liability, the Company said in a comment posted online as part of Tuesday's prepared remarks. Subcommittee staffers said on Monday that Apple was not breaking any laws and had cooperated fully with the investigation. Full Article
Apple Inc Wows Market With Record $17 Billion Bond Deal-Reuters
Reuters reported that Apple Inc wowed the debt markets on April 30, 2013, with the largest non-bank bond deal in history, offering a whopping $17 billion for sale as the U.S. computer giant switches strategy to placate restless shareholders. Just a week after announcing its first drop in quarterly earnings in a decade, Apple came to market with the massive deal to raise funds for an ambitious program that will return $100 billion in cash to holders of Apple shares. Sources said investors could barely submit orders fast enough to get in on the deal from Apple, the only major tech company without a single penny of debt on its books. The six-part all-dollar offering attracted more than $50 billion of orders by midday in New York - a massive level of demand even in the current red-hot climate of the bond markets. Full Article
Apple Inc Issues Q3 2013 Revenue Guidance Below Analysts' Estimates
Apple Inc announced that for the third quarter of 2013, it expects revenue of between $33.5 billion and $35.5 billion. According to I/B/E/S Estimates, analysts on an average are expecting the Company to report revenue of $38.2 billion for the third quarter of 2013. Full Article
Apple Inc Increases Repurchase Authorization; Approves Quarterly Dividend
Apple Inc announced that its Board of Directors has authorized a significant increase to the Company’s program to return capital to shareholders. The Company expects to utilize a total of $100 billion of cash under the expanded program by the end of calendar 2015. This represents a $55 billion increase to the program announced last year and translates to an average rate of $30 billion per year from the time of the first dividend payment in August 2012 through December 2015. As part of this program, the Board has increased its share repurchase authorization to $60 billion from the $10 billion level announced last year. It is expected to be executed by the end of calendar 2015. Apple also expects to utilize about $1 billion annually to net-share-settle vesting restricted stock units. Additionally, the Board has approved a 15% increase in the Company’s quarterly dividend and has declared a dividend of $3.05 per common share, payable on May 16, 2013 to shareholders of record as of the close of business on May 13, 2013. Full Article
Apple Inc To Pay $53 Million In iPhone Warranty Settlement-DJ
Reuters reported that Apple Inc has agreed to pay $53 million to settle a class action lawsuit claiming it failed to honor warranties on iPhones and iPod Touches, Wired reported on Thursday, citing an agreement it obtained. The settlement provides cash payments to potentially hundreds of thousands of iPhone and iPod Touch owners, who found Apple unwilling to repair or replace their faulty phones under Apple's one-year standard or two-year extended warranty. Apple admits no wrongdoing in the settlement which is expected to be filed in San Francisco federal court in coming weeks and which requires a judge's approval. Models affected include the original iPhone, iPhone 3G, IPhone 3GS, and the first-, second- and third-generation iPod Touch. Full Article
Apple Inc, Google Inc Won't Face Poaching Class Action Suit, Yet And Defendants Includes Adobe Systems Inc, Intel Corp, Intuit Inc, And Walt Disney Co's Lucasfilm Ltd-Reuters
Reuters reported that a U.S. judge ruled that a lawsuit alleging a broad conspiracy among Silicon Valley companies not to poach each other's employees cannot proceed as a class action for now, but left the door open for workers to eventually sue as a group. In a decision released on Friday, U.S. District Judge Lucy Koh in San Jose, California said the five software engineers suing Apple Inc, Google Inc and five other companies have yet to show enough in common among the proposed class members to allow them to sue together. But in deciding to give the plaintiffs another chance, the federal judge said she was 'keenly aware' new evidence had recently become available that could support class certification. She also said the nature of the 'alleged overarching conspiracy' and desire to litigate it all at once weighed 'heavily' in favor of certifying a class, which the plaintiffs' lawyers have said could include tens of thousands of people. If the plaintiffs win class certification, then they would have more leverage to extract large financial settlements than if they were to sue individually. Other defendants in the case include Adobe Systems Inc, Intel Corp, Intuit Inc, and Walt Disney Co's Lucasfilm Ltd and Pixar units. The defendants were accused of violating the Sherman Act and Clayton Act antitrust laws by conspiring to eliminate competition for labor, depriving workers of job mobility and hundreds of millions of dollars of compensation. Full Article
Chinese Regulator Calls For Tighter Supervision Of Apple Inc-Reuters
Reuters reported that Apple Inc has come under criticism from a Chinese marketplace regulator, which called for stronger supervision of the iPhone-maker's consumer policies within the country, according to state-run media. On Thursday, the official China National Radio cited notice from the State Administration for Industry and Commerce that urged authorities to protect consumers' rights in accordance with the law. According to CNR's website report, the notice mentions Apple but stops short of specifying what exactly they need to go after and how to do so. The notice, CNR said, was in response to widespread reports since March 15 on how Apple's after-sales service had hurt Chinese consumers. Apple was singled out on March 15 by state-run China Central Television in an annual corporate malpractice expose. Other media outlets have since taken up the baton, focusing on the company's warranty policy on Mac laptops, which critics say is shorter than in other countries. Full Article
Apple Inc Buys Silicon Valley Startup WiFiSlam-Reuters
Reuters reported that Apple Inc has acquired a Silicon Valley startup, WiFiSlam, which makes mapping applications for smart phones. Apple confirmed the acquisition, but declined to give details. The news was earlier reported by The Wall Street Journal, which quoted a person familiar with the matter as saying that Apple paid around $20 million for the company. WiFiSlam develops technology that provides indoor tracking and similar services. Full Article
EU Regulator Monitors Apple Inc iPad And iPhone Distribution-Reuters
Reuters reported that the European Union (EU) is looking into potential antitrust violations involving the distribution of Apple Inc's iPhones and iPads, after receiving what sources said were informal complaints from telecoms operators. The complaints involve handset subsidies and marketing that the technology corporation sign-off with operators that carry its smartphones and tablets, and also includes subsidies that carriers pay to Apple. U.S. and European operators pay hefty subsidies to smartphone makers including Apple, offering customers an attractive discount on devices in exchange for tying them into lucrative two-year wireless contracts. Full Article
Sony Corp And Koninklijke Philips Electronics NV owned Intertrust Technologies Corp Sues Apple Inc-Reuters
Reuters reported that Intertrust Technologies Corp, a software firm owned by a group that includes Sony Corp and Royal Philips Electronics (Koninklijke Philips Electronics NV) said, it has sued Apple Inc for infringing 15 patents relating to security. The lawsuit covers devices such as the iPhone and iPad, Mac computers and laptops, Apple TV and services including iTunes, iCloud and the Apple App Store, Intertrust said in a statement that gave no dollar figure associated with the lawsuit. Apple declined to comment. Full Article
Apple supplier Cirrus slumps as pricing pressure grows
SAN FRANCISCO - Shares of Apple supplier Cirrus Logic slumped 18 percent on Thursday after the chipmaker said in a filing it faces growing pricing pressure in the smartphone market.
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