Posts tagged 'Technology'

Cisco loses 6,500 jobs in drive to cut costs

Cisco Systems is to cut its workforce by 9 per cent as it struggles to improve its performance and refocus on its core network equipment operations, the FT reports. The Silicon Valley company said 6,500 employees would leave the company as part of a $1bn annual operating expenses reduction announced in May. This includes about 2,100 staff opting for voluntary early retirement.The cuts were fewer than anticipated, with sources indicating last week that 8,000-10,000 jobs could be cut from a global workforce that totalled 73,400 at the end of April. Its headcount is set to be reduced by another 5,000, however, after the sale of a factory in Mexico to the Taiwanese contract manufacturer Foxconn, also announced on Monday.

US tech fund taps into social media

A second US fund dedicated to investing in still-private social networking and other technology companies has launched, marking the return of an investment strategy not seen since the dotcom bubble of the late 1990s, the FT says. The new fund, Keating Capital, announced it has raised $86m in capital from investors in an initial public offering, and is set to begin trading on the Nasdaq exchange as a closed-end fund by the end of the year. Earlier this year, GSV Capital raised $50m, and is currently trading on the Nasdaq. Mashable has an infographic comparing the dotcom bubble with recent activity.

Oracle rules out M&A as too costly for now

The FT reports that sharp increases in share prices of young technology companies has led Oracle, Silicon Valley’s most acquisitive company, to turn its back temporarily on considering new deals, the company’s executives said on Thursday. “They are by and large not attractively priced right now and don’t make sense and we’re not doing them,” said Larry Ellison, chief executive, on a conference call to discuss the company’s latest earnings. “Anyone looks at the valuations today, and we don’t think they make any sense,” said Mr Ellison, who began a series of acquisitions nearly a decade ago that has left Oracle with a software business that tops IBM and is second only to Microsoft. Safra Catz, Oracle’s co-president and a former investment banker, added that prices of potential targets were “quite ridiculous”. The high price of acquisitions meant that Oracle had turned its sights inward for growth, for instance by boosting the number of sales people in its hardware division, said Mr Ellison.

Domain name scramble looms for companies

Businesses are facing a dilemma over how to protect their trademarks after the body governing internet names voted on Monday to allow the creation of thousands of web suffixes to run alongside .com and .net, the FT reports. For a starting price of about $500,000, the Internet Corporation for Assigned Names and Numbers will allow companies and community groups to create customised domain names – such as .canon for the camera maker or .london for the English capital. So-called “generic” domains, putting common words after the “dot” in addresses, will extend the system further. The actual cost for popular domain names contested by several parties, however, is likely to multiply, with lawyers predicting that the new addresses will trigger big legal battles.

Dupe de Group(on) – some very special accounting

You gotta love new accounting principles — especially ones drummed up by IPO-ing tech firms.

From Groupon’s S-1 filingRead more

Apple Macs hit by scareware attacks

One of the most pervasive and costly types of virus is now affecting Mac computers, signalling the end of an age of innocence for Apple customers, who until now have been spared many common cybersecurity problems, the FT reports. Known as rogue antivirus or scareware, the scam programs warn PC and now Mac owners that they have been infected, then demand credit card payments to clean the machines. The operators of the programs are typically criminals who may resell the card details or try to install more malicious software.

China growth and eurozone debt woes batter risk assets

Markets were enduring a classic “risk off” session as traders were rattled by evidence of slowing growth in China and the debilitating irritant that is the eurozone fiscal crisis, the FT’s global market overview reports. The FTSE All-World equity index was down 1.1 per cent and industrial commodities were sliding. US stock futures pointed to Wall Street opening lower by 1 per cent, starting a fourth consecutive week of declines, while the FTSE Eurofirst 300 was down 1.3 per cent as miners, financials and technology groups saw sellers. Investors were seeking the refuge of the dollar, Swiss franc, Treasuries and gold. A clue to the session’s risk aversion was being provided by the euro, which was down 0.9 per cent to $1.4008 and had hit a record low against the Swiss franc of SFr1.2352.

Kindle e-book sales soar for Amazon

Amazon.com says it is selling more e-books for its Kindle electronic reading device than paperback and hardback print editions combined, helping its book business to see its strongest growth in more than a decade, the FT reports. The news that the online retailer has sold more than three times as many Kindle books so far this year as in the same period of 2010 came as the Association of American Publishers reported that US e-book revenues had grown 146 per cent in March over the same month a year earlier. Amazon only released unit sales data rather than comparable revenue figures, and Kindle editions typically sell for lower prices than print titles. However, the data suggest it may be extending its leading market share in e-books following the release five weeks ago of a cut-price Kindle at $114 for customers willing to accept sponsored screensavers and other advertising.

Iridium soars on high-tech gadget demand

The popularity of smartphones, tablets and flatscreen televisions has triggered a 150 per cent jump in the price of a little-known metal used in the manufacture of backlit screens, the FT reports. Demand for iridium, one of the earth’s rarest metals, more than quadrupled last year, according to Johnson Matthey, the precious metals refiner that compiles benchmark supply and demand statistics on the market. The sudden rush of buying in the tiny market has sent the price of iridium soaring to an all-time high above $1,000 a troy ounce. The 150 per cent surge in prices since the start of 2010 dwarfs the rallies in silver, gold, platinum and palladium. The market for iridium is very small, less than $500m a year compared with $30bn for silver and $10bn for platinum, but the metal is crucial for some new technologies.

Intel claims 3D chip revolution

Intel has claimed the biggest breakthrough in microprocessor design in more than 50 years, raising the stakes significantly for rivals in the increasingly capital-intensive global chip industry, reports the FT. The world’s biggest chipmaker said on Wednesday that it would begin producing chips this year using a revolutionary 3D technology that has been nearly a decade in the making, and which it said would act as the foundation for generations of computing advances to come. Microchip transistors, the building blocks of electronics, have to date been produced in flat structures – akin to printing on a sheet of paper. Intel’s breakthrough involves producing more complex three dimensional transistors on chips.

Ericsson boosted by mobile broadband demand

Shares in Ericsson rose more than 8 per cent on Wednesday after the Swedish network equipment maker announced better than expected first-quarter results driven by surging use of mobile broadband services, the FT reports. Net profits more than tripled to SKr4.1bn ($674m) from SKr1.3bn in the same period last year, easily exceeding analysts’ consensus forecasts for about SKr3bn.  Hans Vestberg, chief executive, attributed the strong results to rising demand for network infrastructure, such as radio base stations, as increased use of bandwidth-hungry smartphones and other mobile broadband devices prompts telecoms operators to increase capacity.

Data breach hits 70m Sony customers

More than 70m users of Sony’s online gaming network have had their names, e-mail addresses and passwords stolen by a hacker in one of the largest privacy breaches to date, the FT reports. Sony announced on Tuesday that the information had been taken – six days after it closed the PlayStation Network – as it began e-mailing users of the free service with warnings to be on the lookout for scams. The Japanese electronics and entertainment powerhouse said it was possible that credit card information had been taken as well, recommending that customers who had supplied those numbers online should review their bills carefully. The breach is troubling because many Sony gamers are likely to have used the same passwords for e-mail and social networking accounts. The hacker could resell user name and password combinations to other criminals, who could take control of those accounts and mine them for bank account passwords or send bogus e-mails to friends’ addresses.

RIM shares tumble on PlayBook costs

Research in Motion cautioned that its performance in the current quarter would be affected by costs associated with the launch of its PlayBook tablet device next month, disappointing investors who sold-down the stock in after-market trading, the FT reports. Shares in the Canadian company tumbled as much as 12 per cent in after-hours trading on Nasdaq before settling 10 per cent lower at $57.50. RIM also confirmed that its soon-to-be released PlayBook will be able to run software applications developed for other devices, including Android-based smartphones – a move that could enable it to compete more effectively with Apple’s iPad. Continued strong sales of its BlackBerry family of smartphones, particularly in markets outside North America, helped RIM report a 36 per cent increase in fiscal fourth-quarter revenues and a 32 per cent increase in net profits for the quarter ending February 28.

Oracle earnings beat expectations

Oracle, the US software maker, claimed market share gains from rival SAP on Thursday as it reported quarterly earnings that showed a further rebound from the economic downturn, the FT reports. A better than expected 29 per cent rise in revenue from new software licences pushed the company’s earnings well above its own and Wall Street forecasts. Oracle issued a forecast for its current quarter ahead of most estimates and raised its dividend by 20 per cent. The company’s shares climbed 3 per cent in after-market trading, having already risen more than 2 per cent earlier in the day. Safra Catz, one of two Oracle presidents, would not attribute the group’s success to a broader recovery in IT spending, claiming it reflected the success of a wave of Oracle software products and the successful integration of Sun Microsystems, which it acquired early last year.

Four to leave Hewlett-Packard board in revamp

Hewlett-Packard added five new directors to its board, giving majority control of the world’s top-selling technology company to people who weren’t involved in the controversial August ousting of chief executive Mark Hurd, the FT reports. Four serving directors will stand down, while new chief executive Léo Apotheker and chairman Ray Lane, who both joined in late September, will be among the eight who remain, the company said on Thursday. The shake-up gives HP distance from the continuing fallout from the departure of Mr Hurd, a hard-driving executive whose resignation knocked $10bn off the company’s market value. “It’s very unusual” said Steve Mader, a director at recruiters Korn/Ferry International. “One of the obvious possibilities is that the decisions around Hurd and some of the subsequent actions were a schism or a factioning on the board”.

Skype chief in call to arms

Skype plans to lift its headcount by nearly 50 per cent this year, reports the FT, as it looks to reinvigorate its lacklustre product development processes and capitalise on its viral consumer growth. The hiring spree marks an attempt by Tony Bates, Skype’s new chief executive, to inject urgency into a company synonymous with online voice and video calling. While its brand recognition and reach put it among the top handful of consumer internet companies, Skype has been slow to come up with a broad “premium tier” of services for which it can charge users – something Mr Bates aims to put right in a hurry.

Dell’s quarterly profits double on year ago

Dell’s third-quarter profit more than doubled from a year ago on a 19 per cent increase in sales, easing concerns among technology investors about a slowdown in the sector, the FT reports. Shares in the second largest computer maker in the world by units shipped rose 5 per cent in after-hours trading on Thursday after the company said that all its divisions enjoyed revenue gains. In total, Dell said that net income reached $822m, or 42 cents a share, up from $337m and 17 cents, on revenue of $15.4bn. That encouraged investors alarmed by mixed results from Cisco Systems last week, although Dell cautioned that consumer demand remained “more muted” and it kept its full-year revenue guidance unchanged. Hewlett-Packard is set to report on ­Monday.

Google confounds fears of expansion of costs

Fears that Google would allow its costs to spiral upwards as it prepared for a new wave of expansion proved unfounded in the company’s lastest quarter, as a jump in revenues and tighter controls led to earnings that comfortably beat analysts’ forecasts, the FT reports. The company’s shares jumped 8 per cent in after-market trading. The internet search company reported a 25 per cent jump in net revenues, to $5.48bn, as advertising continued to bounce back strongly from the downturn. Wall Street had been expecting a rise of only 20 per cent in net revenues, which are calculated after deducting the $1.81bn in traffic acquisition costs Google paid to other internet companies that generated some of its search traffic. Operating expenses, meanwhile, rose 34 per cent as the company continued to boost its spending on sales and marketing and on research and development. Headcount also continued to rise swiftly, rising by around 1,500, to 23,331, in the period.

Intel upbeat as results beat expectations

Intel reassured markets at the start of the earnings season with third-quarter results ahead of its reduced expectations and a forecast of “healthy worldwide demand” for products for the rest of the year, reports the FT. Amid fears of a double-dip recession, the world’s biggest chipmaker had warned at the end of August of weaker demand than expected for computers in mature markets, reducing its sales forecast from about $11.6bn to $11bn. The “back-to-school” season was disappointing for PC makers in the US. Price-cutting is reported to have led to a recovery in September, meaning the “last four weeks of the quarter were better than we first thought”, according to Paul Otellini, chief executive. This had made Intel more optimistic about the fourth quarter. Intel shares closed at $19.77 in extended trading in New York.

Microsoft unveils its Windows Phone 7

Microsoft has sought to turn its back on more than decade of faltering performance in the mobile software business, betting heavily that it can use a new focus on design and marketing to recoup lost ground from Apple and Google, reports FT. The about-turn was on display on Monday as the software company took the wraps off a new family of smartphones based on its latest mobile software, called Windows Phone 7. A leader in the smartphone software world before the iPhone was launched three years ago, Microsoft has since seen its market share collapse to barely 5 per cent. Its sharp decline has led Microsoft executives to warn that its broader position in a new technology world, that depends on a range of personal devices that connect to services delivered over the internet, could be damaged unless it finds a way to fight back.

Cisco plans home videoconferencing

Cisco Systems, the top networking gear maker, has brought out its first homegrown product for consumers, a $599 gadget for videoconferencing from the living room, the FT reports. Cisco is aiming the premium device at US customers with high bandwidth, which analysts said would limit its potential for wide adoption, while the lofty purchase price and $25 monthly fee will discourage others. The New York Times Bits blog has a rundown of the new product.

HP and Dell ramp up war for 3Par

Hewlett-Packard has already swooped in on Dell’s $1.3bn bid for data firm 3Par with a $1.6bn counter-bid, but the battle is far from over, reckons the NYT’s Dealbook. Dell needs 3Par to move into enterprise technology — and Oracle, the only firm that could outbid either firm, is so far absent. At any rate, deal-making in the tech sector is up 60 per cent in a year, says the FT, thanks to a slew of big transactions, and HP has been tracking the prospects of a 3Par bid for a while. A shame, then, that its valuation of the firm is ‘frankly bonkers,’ Lex argues, with 3Par not having made operating profit for half a decade.

Morgan Stanley really likes its new iPad

June 8 2010 — Morgan Stanley says iPad will reshape netbook market.

August 20 2010 — Morgan Stanley downgrades Blackberry-maker RIM. Read more

Cisco stock smashed on ‘unusual uncertainty’

Shares in Cisco Systems plummeted 8 per cent in after-hours trading on Wednesday after the firm’s chief executive John Chambers warned of ‘unusual uncertainty’ in the economic and revenue outlook, Reuters reports. Cisco’s warning sparked fears that a rise in technology spending could vanish before it has properly begun, following a set of disappointing results for IBM and Texas Instruments last month, says the FT.

Google doubles acquisitions as internal growth disappoints

Google is stepping up its rate of business acquisitions in order to make up for lack of growth from internal projects, Bloomberg reports — upping the pace to once every fortnight rather than just once a month. With deals being made with tech start-ups involved in everything from social network to gaming and graphic advertising, the company appears to be trying to keep pace with Facebook’s rapid growth. But the recent policy statement Google made with Verizon on changes to net neutrality is a threat to tech start-up growth, says the NYT.

Is Skype the one?

It’s been a year marked by inconsistency for initial public offerings, and the tech sector has been no exception. There was a long period of drought until three companies — RealD, Qlik Technologies, and Smart Technologies – filed in quick succession last month.

But until Skype filed today, following Demand Media’s filing last Friday, it would have been easy to forget that since at least the end of 2009, a number of analysts and venture capital observers have been waiting for a larger wave of IPOs in the sector. Facebook, Zynga, LinkedIn, and yes, Skype, were all among the big names thrown around as possible listings. (To get a sense of the optimism, see this story quoting Renaissance Capital’s Paul Bard, or this interview with Mark Mehaney of Citi Investment Research.) The idea was that it would take just one big, successful filing for investor demand to explode. Read more

Apple sales fueled by demand for new devices

Solid demand for the latest iPhone and iPad tablet computer enabled Apple to report surprisingly robust sales and earnings on Tuesday, the FT reports. Apple reported revenues of $15.7bn (£10.3bn) for its latest quarter, a jump of 61 per cent and well ahead of the $14.74bn that most analysts had expected. Net income rose 78 per cent to $3.25bn. The FT’s TechBlog has a blow-by-blow of Apple’s blow-out quarter.

Record quarter for Intel lifts tech sector

Intel reported the best quarter in its history as corporate customers increased information technology spending, boosting hopes that businesses are engaged in a long-awaited “refresh” of both hardware and software in the aftermath of the financial crisis, the FT reports. Separately, FT Alphaville notes that Goldman Sachs is really enjoying its new Apple iPad.

Abu Dhabi to create regional semiconductor hub

Abu Dhabi on Tuesday announced plans to bring the global chipmaking industry to the Middle East, as the emirate seeks to diversify its economy into knowledge-based industries, the FT reported. Ibrahim Ajami, chief executive of state-owned Advanced Technology Investment Company, said his company would invest in building a “capital intensive, manufacturing-driven cluster” technology cluster.

Apple sells 2m iPads

A strong international debut for Apple’s iPad lifted sales of the tablet computer to 2m since its US launch two months ago, the company said, outpacing sales of its flagship Mac laptop and desktop computers, the FT reported. The iPad’s debut exceeded that of the original iPhone but analysts said it fell short of the iPhone 3G, launched in 2008, which sold about 3m units in the first month.