iPhone holiday sales up despite supply shortages and more business news

iPhone holiday sales up despite supply shortages

Apple shook off supply shortages that have curtailed production of iPhones and other popular devices to deliver its most profitable holiday season yet.

The results posted Thursday for the final three months of 2021 help illustrate why Apple is looking even stronger at the tail end of the pandemic than when the crisis began two years ago.

At that point, Apple’s iPhone sales had been flagging as consumers began holding on to their older devices for longer periods. But now the Cupertino, California, company can’t seem to keep up with the steadily surging demand for a device that has become even more crucial in the burgeoning era of remote work.

“IPhone has never been more popular,” Apple CEO Tim Cook crowed during a conference call with analysts. The company’s Mac computers and, to a lesser extent, iPads also continue to proliferate. With the iPhone leading the way, Apple disclosed it now has more than 1.8 billion devices worldwide now in use.


Volatile stock market pushes S&P500 lower

Another volatile day of trading on Wall Street ended Thursday with stocks closing lower after giving up an early rally. The late-afternoon fade extended the market’s losing streak as it closes in on its fourth weekly loss.

Markets are still processing the latest indications from the Federal Reserve a day earlier that the central bank is increasingly concerned about inflation and plans to raise interest rates and take other steps soon to fight it. Investors were encouraged to see strong figures for U.S. economic growth, which showed the biggest climb in GDP last year since 1984.

The S&P 500 fell 0.5%. The benchmark index had been up as much as 1.8% in the early going. The Dow Jones Industrial Average slipped less than 0.1% and the Nasdaq gave up 1.4%. Smaller company stocks fell more than the broader market, sending the Russell 2000 index 2.3% lower.

Stocks have been on a roller-coaster ride throughout the week as investors try to adjust to the idea of rising interest rates after the Fed’s policy of near-zero rates helped boost stock prices for nearly two years.

“I’d kind of characterize this as healthy whiplash,” said Jason Pride, chief investment officer of private wealth at Glenmede. “The market’s seeing the change in terrain and it’s adjusting appropriately; the terrain is going to have higher interest rates.”

The S&P 500 fell 23.42 points to 4,326.51, its third straight decline. The index has notched a gain only five days so far in January. It’s within 10 points of entering a “correction,” meaning a drop of 10% from the all-time high it set Jan. 3.


Mortgage rates flat after earlier increases

Average long-term U.S. mortgage rates were essentially flat this week after jumping nearly a half percent the past two weeks as lenders anticipated the Federal Reserve’s announcement of pending rate increases.

The average rate on the 30-year loan ticked down to 3.55% from 3.56% last week, mortgage buyer Freddie Mac reported Thursday. It stood at 2.73% a year ago.

The average rate on 15-year, fixed-rate mortgages, popular among those refinancing their homes, edged up to 2.80% from 2.79% last week. One year ago, the rate was 2.2%.


Comcast signups drop but theme parks grow

Comcast signed up far fewer internet customers during the fourth quarter last year than in 2020, but continued to see theme parks and film studios rebound after they were pummeled by the pandemic.

The cable and media giant’s fourth-quarter profits fell 9.6% to $3.06 billion, or 66 cents per share, from nearly $3.4 billion a year earlier. The company’s revenues rose 9.5% to $30.3 billion.

The Philadelphia company added 212,000 broadband subscribers from October through December, down 60.6% from the 558,000 gained a year earlier. Comcast’s broadband business had accelerated in 2020 as more people studied and worked remotely. But that growth slowed down during the second half of 2021.

Still, revenue at Comcast’s cable division was up 4.5% during the quarter to $16.4 billion. The company added 312,000 wireless customers, the best quarterly result since it launched the Xfinity Mobile business in 2017. Comcast continued to shed pay TV customers, losing 373,000.

After COVID-19 upended NBCUniversal in 2020, the media and entertainment unit saw revenues rise 25.6% to $9.3 billion during the fourth quarter. Theme parks had their most profitable fourth quarter on record, as revenue jumped 191% to $1.9 billion, despite limited international guest attendance. The company appeared to benefit from customers returning to movie theaters, too, with revenue from film studios increasing 36.4% to $2.4 billion.


McDonald’s sales up 12.3% in 4th quarter

McDonald’s ended 2021 on a high note, with U.S. customers spending more and fewer restaurant closures in Europe.

The burger giant said Thursday that global same-store sales rose 12.3% for the quarter. Analysts polled by FactSet were expecting a 10.5% increase.

But McDonald’s was still stung by rising prices and higher labor costs, which cut into profits. The Chicago company reported adjusted earnings of $2.23 per share, 11 cents short of Wall Street expectations.

McDonald’s says it expects higher costs for food and paper to persist in the first half of this year.


Southwest Airlines is profitable again

Thanks to strong passenger traffic over the winter holidays, Southwest Airlines is reporting a $68 million profit for the fourth quarter.

Southwest said Thursday it was the airline’s first profit without federal pandemic aid since late 2019. The airline is facing higher costs, however, from boosting wages and hiring more workers.

Southwest says that adjusted earnings in the fourth quarter were 14 cents per share, beating Wall Street’s forecast of 7 cents per share. Revenue was also higher than analysts expected. JetBlue reported a loss of $129 million, while Alaska Airlines eked out an $18 million profit.


Robinhood growth slows, stock falls

Growth keeps slowing for Robinhood Markets, the upstart company that upended the brokerage industry, and its stock keeps falling.

The company whose easy-to-use trading app helped bring a new generation of investors to the market said Thursday that its revenue rose 14% in the fourth quarter from a year ago, less than half its growth rate in the summer months.

The company also warned that revenue in the current quarter could sag sharply from a year earlier. The forecast was weaker than Wall Street was expecting, and Robinhood’s shares fell 11.5% after the market closed, following up on a 6.4% loss in the regular trading session.

The $362.7 million in revenue that Robinhood made during the last three months of 2021 fell short of analysts’ expectations for $376.3 million. So did its net loss of $423.3 million, or 49 cents per share. Wall Street was looking for a loss of 35 cents, according to FactSet.

— Compiled by Dave Flessner

Source News