Apple increases stock buyback, raises dividend
CUPERTINO, Calif. (AP) — Apple Inc. plans to buy back an additional $30 billion of its stock and raise its quarterly dividend by 8 per cent amid a slowdown in revenue growth.
The commitment announced Wednesday as part of Apple’s fiscal second-quarter earnings report expands on the company’s previous pledge to spend $60 billion on stock buybacks by the end of next year. The company is now earmarking $90 billion for buybacks during that time frame.
Apple is also raising its quarterly dividend to $3.29 per share as part its effort to funnel more money to stockholders.
The slowdown in revenue growth has prompted investors to wonder whether the company has lost its innovative power since the death of Steve Jobs.
Facebook 1Q results soar; CFO to step down
NEW YORK (AP) — Facebook’s first-quarter earnings and revenue grew sharply, surpassing Wall Street’s expectations thanks to an 82 per cent increase in advertising revenue.
The social network said Wednesday that it earned $642 million, or 25 cents per share, in the January-March quarter, up from $219 million, or 9 cents per share, in the same period a year ago. Adjusted earnings were 34 cents per share. Revenue rose 71 per cent to $2.5 billion.
Analysts anticipated earnings of 24 cents per share on revenue of $2.36 billion.
Facebook also said that its finance chief, David Ebersman, is leaving on June 1 after five years. He’ll be replaced by David Wehner, currently vice-president of corporate finance and business planning.
Wellness programs grow more popular with employers
The little voice nagging you to put down the cake and lace up the running shoes is increasingly coming from your employer. It is likely to grow louder with a looming change under the federal health care overhaul.
Companies are using wellness programs to improve employees’ health as a means to reduce their medical costs. They’re asking workers to take physical exams and control conditions like diabetes. Some are also dangling the threat of higher monthly premiums to prod workers into action.
The Affordable Care Act calls for a 40 per cent tax on expensive benefit plans starting in 2018. In turn, many companies that offer employer-based coverage already have begun looking for ways to lower costs and avoid that tax.
Russian social media CEO quits, flees country
MOSCOW (AP) — The founder of Russia’s leading social media network — often described as Russia’s Mark Zuckerberg — has left his post as CEO and fled the country as cronies of President Vladimir Putin have made steady inroads into the company’s ownership.
The slow-motion ouster of Pavel Durov from the network known as VKontakte is the latest sign that independent media outlets in Russia have become increasingly imperiled.
The loss of Durov’s leadership in VKontakte means that the space for free speech on the Russian web could shrink even further.
As one of his final acts of defiance, Durov posted online last week what he said were documents from the security services, demanding personal details from 39 Ukraine-linked groups on VKontakte, also known as VK.
A French economist’s grim view of wealth gap
NEW YORK (AP) — Thomas Piketty, the French economist who helped popularize the notion of a privileged 1 per cent, sounds a grim warning in his new book: The U.S. economy has begun to decay into the pattern of aristocratic Europe of the 19th century. Hard work will matter less, inherited wealth more. The fortunes of the few will unsettle the foundations of democracy.
The research Piketty showcases in his book, “Capital in the 21st Century,” has set the economics field ablaze. Supporters cite his work as proof that the wealth gap must be narrowed. Critics dismiss him as a left-wing ideologue.
Digging through 300 years of economic data, tax records, 19th century novels and modern TV shows, Piketty challenges the assumption that free markets automatically deliver widespread prosperity. Instead, he writes, the rich will get richer, and everyone else will find it nearly impossible to catch up.
Sales of new US homes plunge 14.5 per cent in March
WASHINGTON (AP) — The number of Americans buying new homes plummeted in March to the slowest pace in eight months, a sign that real estate’s spring buying season is off to a weak start.
The Commerce Department said Wednesday that sales of new homes declined 14.5 per cent last month to a seasonally adjusted annual rate of 384,000. That was the second straight monthly decline and the lowest rate since July 2013.
Sales plunged in the Midwest, South and West in March. But they rebounded in the Northeast, where snowstorms in previous months curtailed purchases.
New-home sales have declined 13.3 per cent over the past 12 months.
Delta navigates nasty winter, tops profit forecast
DALLAS (AP) — Delta Air Lines Inc. is making more money by filling more seats on its planes and paying a bit less for fuel.
The company’s first-quarter profit beat expectations and underscored how most big airlines are prospering with a combination of strong business travel, slightly higher fares and money from extra fees. Even bad weather couldn’t stop Delta from boosting its profit. It cancelled double the number in January and February from a year ago, which cost the company $90 million in revenue and $55 million in pretax income.
The airline said Wednesday that it expects solid demand throughout the year, and predicted that a key statistic of revenue per mile will grow in the mid-single digits during its second quarter.
Procter & Gamble 3Q net income up on cost cuts
NEW YORK (AP) — Procter & Gamble Co.’s fiscal third-quarter net income rose 2 per cent as it cut costs to offset sluggish sales in some categories like beauty and family products.
The world’s largest consumer product maker’s adjusted earnings topped analysts’ estimates, but revenue fell short.
Since CEO A.G. Lafley returned to the company in May, Procter & Gamble has focused on its most profitable markets and products and on introducing new products. The Cincinnati-based company’s turnaround plan also includes cutting costs to save $10 billion by fiscal 2016.
Amazon snares classic shows in deal with HBO
NEW YORK (AP) —Amazon is teaming up with HBO in a deal that will make some classic TV shows like “The Sopranos” and “The Wire” available to Amazon prime members.
It is the first streaming arrangement agreed to by the cable network.
Amazon Prime members — who pay $99 a year for streaming entertainment, two-day shipping and other perks— will be able to watch some shows beginning May 21. Past seasons of newer shows such as “Girls,” ”The Newsroom” and “Veep” will also become available throughout the multi-year agreement HBO. The deal also includes some older original movies and comedy specials.
The HBO deal is a big win for Amazon, which is facing tough competition for streaming services as more people cut the cord on cable.
Memory Lane: Travelling through time on Google maps
MOUNTAIN VIEW, California (AP) — Trips down memory lane are now available on Google’s digital maps.
The new twist on time travel is debuting Wednesday as part of the “Street View” feature in Google’s maps, a navigational tool that attracts more than 1 billion visitors each month.
Street View snapshots will now include an option to see what neighbourhoods and landmarks looked like at different periods in the last seven years, as Google Inc. has been dispatching camera-toting cars to take street-level pictures for its maps.
Google Inc. intends to keep adding pictures to the digital time capsules as its photo-taking cars continue to cruise the same streets gathering updates.
By The Associated Press=
The Dow Jones industrial average lost 12.72 points, or 0.1 per cent, to close at 16,501.65. The Standard & Poor’s 500 index lost 4.16 points, or 0.2 per cent, to 1,875.39. The Nasdaq composite fell 34.49 points, or 0.8 per cent, to 4,126.97.
U.S. crude for May delivery fell 31 cents to close at $101.44 a barrel on the New York Mercantile Exchange. Wholesale gasoline was flat at $3.09 a gallon. Heating oil fell 2 cents to $2.98 a gallon. Natural gas slipped 1 cent to $4.73 per 1,000 cubic feet. Brent crude, an international benchmark for oil, fell 16 cents to $109.11 on the ICE Futures exchange in London.