Apple just reported its best quarter of all time, as covered by my colleague David Sarno here on the Technology blog.
The Cupertino tech giant reported a boost in sales of iPads, iPhones and Mac computers (but not iPods), pushing it into a record quarterly revenue of $46.33 billion and $13 billion in profit for the first quarter of the company's 2012 fiscal year.
Let's take a closer look at Apple's huge numbers for the quarter ended Dec. 31, which showed strong holiday sales and sent shares in the company up 8% after the markets closed Tuesday.
Cash balance — One major number to note from Apple's earnings report, as mentioned in its earnings call, is that the company has a cash balance of $97.6 billion, up from $81 billion a year ago.
That's a massive amount to be sitting in the bank and it's a sum Apple will spend in part on developing new products that will help it remain competitive against rivals such as Samsung, Sony, HTC and Motorola.
Revenue — Apple racked up $46.33 billion in sales in the 14-week quarter, which is up from $26.74 billion in the same quarter a year ago.
Profit — The tech giant reported a $13-billion profit last quarter, which is more than double the profit the company reported for its first fiscal quarter of 2011.
IPhones — Apple sold 37.04 million iPhones in the last three months of 2011, which marks 128% growth from a year earlier, when the company sold 16.25 million iPhones.
IPads — Sales of the ever-popular Apple tablet grew 111% when compared to the year-earlier quarter, with 15.43 million iPads sold for the company's fiscal 2012 first quarter versus 7.33 million iPads sold in the first quarter of 2011.
IPods — The iPod isn't dead yet, but it is on the decline. Apple sold 15.4 million iPods last quarter, down 21% from 19.45 million iPods sold a year earlier.
Mac computers — Apple's Mac line of desktop and laptop PCs — which includes MacBooks, iMacs, Mac Minis and the Mac Pro — saw a 26% increase in sales from the year-ago quarter, with 5.2 million Macs sold in the first fiscal quarter of 2012 and 4.13 million Macs sold in the first fiscal quarter of 2011.
"Portables," which would include the MacBook Air and MacBook Pro laptops, made up the majority of Macs purchased, with 3.71 million units sold last quarter, up from 2.9 million sold a year ago. Apple sold 1.48 million desktops last quarter, up from 1.23 million sold a year earlier.
Looking ahead, Apple said Tuesday that it is projecting it will record about $32.5 billion in revenue in the second quarter of its fiscal year.
[Updated: An earlier version of this post incorrectly stated that Apple's profit for the first quarter of its fiscal year was $6 billion. Apple reported a $13 billion profit last quarter and recorded $6 billion in profit a year earlier.]
– Nathan Olivarez-Giles
Photo: An Apple Store in San Francisco. Credit: Justin Sullivan/Getty Images
Beats Electronics and Monster Cable Products, two companies that together defined the current $1-billion headphone industry with the Beats by Dr. Dre line, are parting ways at the end of the year.
But before the two become competitors in a segment of consumer electronics that is just as much about fashion as it is technology, a wave of new Beats by Dr. Dre headphones and boom boxes (built by Monster) will hit store shelves.
At the Consumer Electronics Show in Las Vegas last week, I caught up with Jimmy Iovine, Beats Electronics' chairman and CEO of Interscope Geffen A&M Records, to talk about what products the Beats brand had planned for 2012 (you can see our interview in the video above).
First up will be the new Mixr headphones, designed by Grammy-winning producer and DJ David Guetta. The Mixr is a lightweight and strong design — I twisted and bent the headband, and it returned to form and never felt week — that offers the bass-heavy sound Beats is known for. At $279, the Mixr is set to hit U.S. stores in early February in black and white. They're already available in Europe.
February will also see a wireless release of the Solo headphones, also priced at $279. And due in mid-September are the $349 Executive headphones, which bring a sleeker and more understated look with a leather headband and aluminum ear cups.
Iovine was also proud of the new BeatBox, a follow-up to the first-generation (and much less portable) BeatBox, which will sell at a price of $399. A release date hasn't yet been set for the new battery- or AC-powered BeatBox, which plays music from smartphones and MP3 players docked on the speaker setup.
Since launching in 2009, Beats has teamed with Justin Beiber, Lady Gaga and Sean "Diddy" Combs for artist-sponsored headphones. The Mixr is the only artist-specific set of headphones planned for 2012, Iovine said.
But this year we will see more HTC smartphones paired with Beats headphones as a result of HTC purchasing a $300-million stake in the audio company late last year, he said. And Beats speakers will be found not just in the Chrysler 300, as they were in 2011, but also in the Dodge Charger. And, as we saw at CES, Beats speakers are making their way into more HP laptops this year too.
After the Monster manufacturing deal expires at the end of the year, Beats plans to go out on its own, Iovine told my colleague Gerrick D. Kennedy on our sister blog Pop & Hiss. Despite reports to the contrary, Iovine said, the split was always the audio start-up's intention.
"It was always planned. It was always a five-year deal," Iovine said. "It was a manufacturing distribution deal. We were with Monster for headphones and speakers. It was always a plan to turn into a freestanding company."
Image: The Beats Executive headphones from Beats by Dr. Dre. Credit: Beats Electronics/Monster Cable Products
Surrounded by every electronic device imaginable at the 2012 Consumer Electronics Show, HP’s new Envy 14 Spectre is in a class by itself, mostly because the class it's in — “the premium consumer Ultrabook” – seems to have been invented just to have some place to put it. Let’s take a look.
The first descriptor used is “premium.” That’s a good one, and if you are paying $1,400 for something about the size and thickness of a place mat, whatever it is you are buying should be stamped with the word premium. Generally this would indicate a plethora of features, like Beats Audio for doctor-recommended sound quality (is Dr. Dre still licensed to practice in California?) and the HP Radiance Display that delivers 1600 x 900 lines of resolution. OK, the Spectre has all that. So far, so good.
Right after premium comes the word “consumer,” and that's a little odd because that usually indicates a dearth of features, where things are stripped out to make the product less confusing and cheaper or accessible to the masses, the opposite of premium. So that word makes the least sense, seeing as it has high-end video and audio (knob notwithstanding), a slew of inputs and outputs — including trusty old USB (though in it’s latest 3.0 variant), HDMI and Mini DisplyPort, and a $1,399.99 price tag on a laptop is enough to knock it out of the consumer arena and right back into premium land. It’s kind of like a rich kid who dresses in old clothes so he can make friends with the poor kids, then invites them to his birthday party at the country club with the strict dress code. Just because you add the “consumer” to something doesn’t make it any more affordable, it just makes it take longer to say.
Lastly, it’s an "Ultrabook" because it’s thin, and that’s what ultra means in computer-ese, and into its 20mm of thinness HP has crammed a good deal of stuff, like an Intel Core processor, HP Wireless Audio to stream your music throughout your home, a multitouch trackpad, an HD webcam and a battery that “boasts up to 9 hours” of life among other things. So maybe they are using “ultra” to mean “going beyond” because they amount of tech stuffed into this machine is beyond what one might expect in a package of its dimensions.
So, marketing lingo aside, the really interesting thing about the Envy 14 Spectre is the material used to build most of it: glass. Corning Gorilla Glass to be specific. Not surprisingly, the monitor is fronted with glass, but so is the rest of the lid. It’s almost as if they took a giant iPhone 4 and attached it with a hinge. So, right off the bat, half of the computer is built out of glass, then you have the palm rests and some of the chassis! All this makes for a more durable and lighter package, according to the company, though at about 4 pounds that last bit seems like we’re having our chocolate rations increased from 15 grams to 10 grams. But who cares what it weighs? It’s a laptop made out of glass! I’m not even sure what the advantage really would be for that, but I feel cooler just to have typed out that last sentence.
Perhaps the most telling thing about this device is who HP thinks would want it, and judging by the product photos in the company’s news release, they are aiming for the coveted “I’m far too cool to even acknowledge my expensive new computer sitting there” demographic.
– Tim French
One of the more notable and surprising reveals so far at the 2012 Consumer Electronics Show has been the debut of Vizio's line of laptops and all-in-one desktop PCs. Vizio declined to detail the specifications or release date of its new products, but gave us some hands-on time with the PCs.
The All-in-One, as the desktop version of Vizio's PC debut is known, comes in 27-inch and 24-inch models, both containing high-definition 1080p resolution panels. The general approach is similar to that of Apple's iMac, with nearly the entire device in one self-contained monitor/base unit. Unlike the iMac, however, which positions its processing hardware behind the screen, CPU and hardware connection ports on the All-in-One are all positioned at the base of the device, which still manages to be very thin and is connected to the monitor through an aluminum neck.
The base includes USB 3.0 connections and inputs for two HDMI cables, allowing you to connect your computer, Xbox or anything else that can output HDMI. Vizio's director of product development, Tim Almeda, said the desktops could be configured with up to quad-core processing and 1 terabyte hard drives.
But not all of the device is contained in the base. The power source and subwoofer for the PC are housed in a mash-up external unit that connects to the. This makes it not quite all-in-one, but helps provide a 2.1 stereo sound setup that Vizio says will be included with the computers. User input comes from a wireless keyboard, trackpad and TV-like remote.
Vizio's upcoming laptop line includes two Thin + Light computers, basically in the ultrabook genre, which come in at 14 inches and 15.6 inches, and one more robust 15.6-inch notebook. The full notebook is a little thicker and heavier, but boasts a dedicated graphics card and a hard drive and SSD options. The "Thin + Light" models carry an SSD, and are geared to compete against computers such as Apple's MacBook Air and similar recently released ultrabooks. None of the computers carry an optical drive, but an external CD/DVD drive is available (Vizio wouldn't specify whether an external drive would be available on the larger laptop by default or at an extra cost).
Overall, sleekness and simplicity embody the design of both sets of computers — clean lines, an aversion to design flairs that don't serve any useful function, a brushed metal exterior and a very integrated look between the series. Industrial chic, if you will.
This is apparent even in the font used on the keyboards, which almost looks as if it were built for speed and my colleague Nathan Olivarez-Giles compared to the lettering used by Porsche Design. One can't ignore the design cues taken from Apple in both sets of computers, but if Vizio is successful in creating a stylish, sleek and lower-cost alternative to the iMac, MacBook Pro and MacBook Air, it could be a challenge for the computing giant.
– Armand Emamdjomeh in Las Vegas
Photo: From back to front, Vizio's new 14 inch and 15.6-inch Thin + Light and 15.6-inch notebook computers, and separate optical drive. Credit: Armand Emamdjomeh / Los Angeles Times
Vizio is hoping to find the same success it’s had in the TV business in the competitive market of personal computing.
At the 2012 Consumer Electronics Show in Las Vegas this week, Vizio is showing off its lineup of PCs, which consists of two all-in-one desktops and three laptop computers all running Microsoft’s Windows 7 operating system.
The Irvine company is planning on taking the same retail approach with its PCs that it used with its TV and home-theater products, selling its devices at lower prices than most rivals, said Jim Noyd, a Vizio spokesman.
On the laptop side of Vizio’s offerings will be a 15.6-inch-screen laptop and two thin and light laptops in both a 15.6-inch screen size and a 14-inch size. The thin and light laptops will be lower-cost alternatives to Apple’s MacBook Air and Ultrabook laptops from the likes of Dell, Lenovo and HP.
Desktop-wise, Vizio is planning on releasing two all-in-one models to challenge the likes of Apple’s iMac. The desktops will be built in both 24- and 27-inch screen sizes.
So far, Vizio isn’t offering any details on the specs of its PCs or its processor partners, though the company says it is set to release its PCs sometime this spring.
We’ll go hands-on with Vizio’s PC lineup later at CES, but for now check out the media photos Vizio sent to the Technology blog to see some detailed shots of how these new Windows machines will look.
– Nathan Olivarez-Giles in Las Vegas
Photos: Vizio’s laptop (top) and desktop (bottom) PCs. Credit: Vizio
"It underscores just the magnitude of this marketplace," said Steve Koenig, director of industry analysis at the Consumer Electronics Assn. "When you're talking about a market of 3 1/2 billion people that all want TVs, that all want phones, that's a huge market opportunity…. I don't know when we're going to hit $2 trillion, but with the pace of growth in these emerging economies, it probably won't take long."
As people around the world buy more tech gadgets, the industry is entering the second phase of the digital revolution. Consumers should expect the newest devices to become even more seamless in their lives; tech companies will be keenly focused on rolling out new smartphones and tablets that are multifunctional and can replace old-school products (sorry, camcorders).
Those findings were shared in two back-to-back news conferences Sunday during the media preview day at the Consumer Electronics Show in Las Vegas, the first on the state of the industry and trends to look out for at CES, and the second on global market figures.
Tech experts told an overflow crowd of reporters — nearly all of them clicking away on laptops and tablets and snapping photos on their smartphones — that they expected slower growth in tech spending in developed countries like the U.S. but an explosion of spending in countries such as China and Brazil. One "sweet spot" in emerging markets will be low-cost smartphones; LCD televisions are also expected to do well.
Among the big trends expected to be seen at CES include devices that are geared more toward personalization and customization, said Shawn Dubravac, the Consumer Electronics Assn.'s chief economist and director of research.
He said he expected to see 20,000 new products launched during this year's show, one of the world's largest consumer electronics trade shows. Many of the products will be smartphones, and phone makers will be aiming to make the "pocketable devices more and more like full-fledged computers," Dubravac said.
Also expected at CES: 30 to 50 new ultrabooks, or super-thin and light laptops, as PC makers try to take share away from Apple's popular MacBook Air.
– Andrea Chang in Las Vegas
Photo: An ice sculpture at CES Unveiled at the Venetian in Las Vegas. Credit: Armand Emamdjomeh / Los Angeles Times
If this holiday season was all about upgrading for you — upgrading to a better computer, phone or camera — then it's time to think about what to do with your old gadgets.
The good news is, you have options. The bad news is, you may have too many options. There are many ways to dispose of your old gadgets responsibly, and navigating it all can be difficult and frustrating.
To help you out, we've put together a step-by-step guide to getting rid of your old electronics now that you have new electronics.
1. The hand-me-down: The best and easiest way to recycle your old electronics is to hand them off to someone you know who can still use them. Do you have a 4-year-old niece who won't know the difference between a 4-megapixel camera or a 12-megapixel camera? She might like your old point-and-shoot. Your frustratingly slow former laptop may work perfectly for a middle-school-age cousin who only needs it for Web surfing.
2. Donate it: So, you don't know anyone who wants your old computer, but if it's still functional there may be someone you don't know who could make use of it. EBay's Rethink Initiative has put together an easy-to-navigate list of organizations that know how to put your old electronics to work.
3. Sell it: You can always sell your old electronics on EBay or Craigslist, but this may be more work than you bargained for. Alternatively, you can check out NextWorth.com, an e-recycling company that will pay you for your working electronics. You can get an instant quote on the company's website and even trade in your electronics at 1,450 Target stores nationwide.
4. Recycle: Unfortunately recycling your old electronics is not as simple as throwing them in with your old newspapers and soda cans. You'll need to find an e-recycling center that knows how to responsibly recycle your gadget. GreenerGadgets.org has a list of e-recycling centers and also has a list of e-recycling centers by ZIP Code. (Look to the bottom right of the screen). Goodwill Industries International Inc. will take e-waste. So will Best Buy.
And if you think this all sounds annoying and hard, we don't totally blame you. But if you take the extra time to recycle your old gadgets, the planet will thank you.
– Deborah Netburn
Image: If you've been lugging around this 1998 iMac personal computer, it's time to let it go. Credit: Associated Press.
Samsung, Sharp and five other LCD makers have agreed to a $553-million multi-state settlement over allegations the firms illegally conspired to inflate prices for liquid crystal displays used in televisions and computer monitors. California was one of the states included in the settlement.
Kathleen Foote, California's senior assistant attorney general, said consumers and government entities in the state would receive "a significant portion" of the settlement, with an exact percentage still to be determined.
The companies — Chimei Innolux Corp., Chunghwa Picture Tubes Ltd., Epson Imaging Devices Corp., HannStar Display Corp., Hitachi Displays Ltd., Samsung Electronics Co. and Sharp Corp., and their U.S. affiliates — agreed to pay more than $538 million to settle antitrust claims brought on behalf of consumers, government entities and other public entities by a group of eight attorneys general and private class-action attorneys, according to the New York attorney general's office.
Separately, five of the tech companies agreed to pay more than $14 million to settle other claims brought by the states in their law enforcement capacities. The corporations also agreed to engage in antitrust compliance programs and to cooperate with the states' ongoing prosecution of other industry participants.
According to the complaint, Japanese, Korean and Taiwanese manufacturers of thin film transistor LCD panels, together with their U.S. affiliates, engineered a conspiracy to fix prices of the panels. Tens of millions of products are estimated to have been sold at inflated prices.
Under the agreements, the companies will pay up to $37 million to compensate government and other public entities for damages resulting from the purchase of thin film transistor LCD panels. Up to $501 million will be available for partial refunds to consumers residing in 24 states and the District of Columbia who purchased products containing thin film transistor panels from Jan. 1, 1999, through Dec. 31, 2006. A notice of how to file for partial refunds will be provided to the public at a later date.
"This price-fixing scheme manipulated the playing field for businesses that abide by the rules, and left consumers to pay artificially higher costs for televisions, computers and other electronics," New York Atty. Gen. Eric T. Schneiderman said in a statement.
– Andrea Chang
Photo: A customer shops for flat-panel televisions at a Best Buy in San Francisco. Credit: Justin Sullivan / Getty Images
Apple's MacBook Air is poised to remain the dominant player in the ultrabook market next year, despite a wave of new ultra-thin notebooks slated to debut in the coming months, one analyst predicts.
Apple's super-thin, super-light laptop has been a hit with consumers, and its momentum "is sustainable and likely has upside potential," JP Morgan analyst Mark Moskowitz said in a note to investors Monday.
Previously, "we highlighted the MacBook Air as potentially becoming a $2-[billion to] $3-billion-plus revenue opportunity," he said. "Our latest view is that this ultra-thin notebook PC appears on track to becoming a $7-billion-plus revenue driver at Apple."
Moskowitz said that ultrabooks continue to be highly discretionary devices and that pricing for rival offerings must fall below $800 before posing a real threat to the MacBook Air. And beyond price, he said, other devices simply don't look as good or offer as much.
"In our view, Apple's first mover advantage and optimized feature set and form factor command a higher price that early adopters, productivity users, and Apple enthusiasts are willing to absorb," he said. "In contrast, we think that the first round of ultrabook offerings lacks the right blend of features and attractive price points to grab market share from Apple."
The MacBook Air costs $999 to $1,599.
– Andrea Chang
Image: Apple's MacBook Air. Credit: Apple
Cisco Systems Inc. sees a cloudy future.
By 2015, cloud computing will account for nearly 34% of traffic at the world's data centers, the huge computing stations that now process and distribute most of the Internet's information. Last year the cloud accounted for only about 11% of data center traffic.
The trend comes as data centers become an ever larger part of the way the Internet works, acting as the digital jet engines for the Internet's most-used services: Google, Facebook, Amazon, Apple's iCloud and many others.
Cisco's first "Cloud Index" report says that overall traffic at data centers will more than triple by 2015, to 4.8 zettabytes from about 1.5 zettabytes in 2011. Cisco is one of the world's largest vendors of the networking hardware that sends data around the Internet and between servers in a given data center.
A zettabyte is an astronomical amount of data, equal to 1 billion terabytes. A terabyte is 1,000 gigabytes. Many current PCs contain about 500 gigabytes of storage. So the amount of data that will be processed by the world's data centers by 2015 is roughly what you could fit on 2 billion modern PCs.
None of that may be very surprising, as the benefits of cloud computing — including the substantially lower cost of storing and retrieving data to consumers and businesses — have been widely extolled in recent years. Cisco differentiates between "traditional" services and cloud servers; the latter is a more elastic type of computing that can grow or shrink depending on the number of active users or the types of tasks it is performing.
That can make for economic and energy efficiency gains by reducing the number of data center servers that sit idle while, for instance, people in North America are asleep. With cloud systems, those otherwise unused servers can be shifted over to perform needed functions — often for different companies on other continents.
The rapid movement of data that goes along with cloud computing has raised a number of concerns about online security, including whether consumers and businesses can know precisely where their private data is located and the extent to which cloud data is vulnerable to hackers or accidental disclosure.
– David Sarno
Image: An artist's rendering of Facebook's newest data center in Lulea, Sweden, on the edge of the Arctic Circle. Facebook picked the location because the cold climate allows it to keep its servers cool more cheaply. Credit: Associated Press