All Things Digital

Ash’s Chainsaw Hand. The Sword of Omens. The Ultimate Nullifier!

We’re thrilled to report our best quarter ever, with the highest revenue and earnings in Apple’s history.”

–Apple CEO Steve Jobs

Well, the street didn’t much care for Apple’s latest financial guidance, did it? Shares of the company tumbled in after-hours trading after Apple offered a disappointing second-quarter outlook.

Though Apple posted its highest quarterly earnings and sales in history today thanks to strong sales of Macs and iPods, its second-quarter guidance fell well short of Wall Street’s expectations. Looking ahead, Apple said it expects earnings of 94 cents a share on revenue of $6.8 billion in its second quarter. Wall Street was looking for earnings of $1.09 a share on revenue of $6.99 billion.

And with concerns of an economic slowdown looming large after Intel issued a cautious outlook for 2008 last week, the market reacted with predictable knee-jerk horror, sending Apple shares down more than 11% 15% 17% in after-hours trading. “All of the numbers were fine,” Piper Jaffray analyst Gene Munster told CNBC. “They continued to gain market share. The issue is that people wanted a more confident ‘guide.’ There’s nothing wrong with the actual numbers, it’s just that people are worried there’s going to be a break.”

Or that we’re already at the beginning of one: iPod sales in the states were flat year-over-year …

QUOTED

It doesn’t matter how good or bad the product is, the fact is that people don’t read anymore. Forty percent of the people in the U.S. read one book or less last year. The whole conception is flawed at the top because people don’t read anymore.”

–Apple CEO Steve Jobs pronounces Amazon’s Kindle e-book reader DOA.

Apple introduced a new version of its eight gigabyte iPod nano digital media player this morning. And it’s pink, which according to Apple is among the iPod’s “much-requested” colors (noticeably absent from that list: the “National Park Bench Brown” shade pioneered by Microsoft’s Zune team.)

“Customers are going to love the gorgeous new pink iPod nano,” Greg Joswiak, Apple’s vice president of Worldwide iPod Product Marketing, enthused in a gushy press release. “The pink iPod nano is perfect for people who want a great new color this spring, or who are searching for a special Valentine’s Day gift.”

Q: You said in the past that a CEO should probably serve 10 years. You’ve served eight. What are your plans? Will you follow your own advice?

A: The first piece of advice I wish someone had given me as a freshman CEO is to keep your mouth shut. Somehow I didn’t get that advice, which is don’t talk about when you’re coming or when you’re going because it just creates a set of questions that probably aren’t productive.

–eBay CEO Meg Whitman, San Francisco Chronicle, Nov. 19, 2006

Looks like eBay CEO Meg Whitman may make good after all on her pledge that no CEO should stay more than a decade. Whitman, the public face of eBay for the past 10 years, is reportedly preparing to retire. She has been delegating more tasks to deputies over the last few months and is expected to decide on her retirement in the coming weeks, The Wall Street Journal reports, quoting “people familiar with the matter.”

John Donahoe, who joined eBay in 2005 to lead its auction business unit, is the leading candidate to succeed her.

Rumors of Whitman’s imminent departure come at a critical time for eBay. The company is due to report earnings for the fourth quarter tomorrow. And though this quarter includes the traditionally strong year-end holiday period, it will likely be marred by a general slowing in eBay’s core auction business and the company’s continued struggles with Skype, the Internet telephony outfit for which it recently took a $1.4 billion write-down.

So perhaps it’s a perfect time for Whitman to step aside. Certainly she leaves a storied career behind her. She led the company through its 1998 initial public offering, and from there through some 40 quarters of sequential revenue growth. An impressive achievement by any measure–Skype acquisition be damned. Now, maybe it’s time to move on to bigger things.

Much bigger. Like perhaps a position in the cabinet of friend and Republican presidential candidate Mitt Romney (shown below, left, with Whitman and VC Steve Jurvetson)? Whitman can’t be suffering through those Romney fund-raising telethons for nothing, right?

We need to invest in areas that are most critical to our success and de-emphasize those that are underperforming or don’t match up with our priorities. There will be no sacred cows.”

–Yahoo CEO Jerry Yang, July 17

When all is said and done, Yahoo CEO Jerry Yang’s abattoir may prove more proficient at slaughtering careers than sacred cows. The company is reportedly planning to lay off hundreds of employees in an effort to rein in its budget and revive its flagging fortunes.

The job cuts are expected to number around 500, out of 14,000 employees globally, though initial reports from more … irrationally exhuberant sources … pegged them at five times that.

Yahoo has so far declined to comment specifically on reports of looming layoffs, though the tenor of a statement the company released yesterday certainly suggests dark days ahead for at least a few employees. “Yahoo has embarked on a multiyear transformation that includes making tough decisions about the business to help the company grow,” a company spokeswoman said in a statement. “Yahoo plans to invest in some areas, reduce emphasis in others and eliminate some areas of the business that don’t support the company’s priorities. Yahoo continues to attract and hire talent against the company’s key initiatives to create long-term stockholder value.”

If they are indeed to occur, layoffs will likely be announced during the company’s fourth-quarter financial report on Jan. 29, which should make for an eventful earnings call.

QUOTED

Apple has destroyed the music business–in terms of pricing–and if we don’t take control, they’ll do the same thing on the video side.”
–NBC Universal chief executive Jeff Zucker, Oct. 28, 2007

We’ve said all along that we admire Apple, that we want to be in business with Apple. We’re great fans of Steve Jobs.”
–NBC Universal chief executive Jeff Zucker, Jan. 20, 2008