UPDATE, 11:08 AM: Apple‘s part of today’s proceedings is over after Sen. Carl Levin finally drew blood. He hammered CEO Tim Cook and other Apple execs for creating business arrangements that ensured that the company’s “crown jewels” — economic rights to more than two-thirds of its worldwide profits — “are in three Irish companies that you control and don’t pay taxes.” Cook acknowledged that he has “no current plan” to bring that cash “home at the current tax rate.” Levin noted that this was entirely Apple’s choice: The arrangement in Ireland was signed by “three people working for Apple.” He also observed that the company repatriates profits from Latin America and Canada but not elsewhere. “We cannot continue a system where a multinational company as phenomenally successful as you can make a decision as to where the profits are going to flow. An American company where the R&D is 95% in the United States. You had R&D tax credits, all the benefits of living in this country, [including] protection of patents….You made a unilateral decision where these profits are going to be taxed or not taxed. Folks, that is not right.”
Related: Lawmakers Say Apple Exploits Loopholes To Avoid U.S. Taxes
PREVIOUS, 10:13 AM: Tim Cook seems to be in command so far in his appearance before the Senate’s Permanent Subcommittee on Investigations to defend Apple against charges that it parks cash overseas to avoid paying U.S. taxes. He began his testimony throwing down a gauntlet calling for “dramatic simplification” of U.S. corporate taxes. “Apple has always believed in the simple, not the complex,” he said adding that it should also apply to the tax code. He called for a revenue-neutral change that would lower corporate income tax rates and provide for “a reasonable tax”– which he said should be a single digit percentage — “that allows the free flow of capital back to the United States.” It would probably increase Apple’s U.S. taxes, he says, but “it would promote U.S. economic growth.” READ MORE »
Apple CEO Tim Cook can expect a tough grilling about his company’s tax practices tomorrow when he appears before the U.S. Senate Permanent Subcommittee on Investigations hearing on “Offshore Profit Shifting and the U.S. Tax Code.” An 18-month bipartisan investigation — whose findings were summarized in a memo released today – charges that Apple’s offshore subsidiary, Apple Operations International, reported net income of $30B from 2009 to 2012 but “declined to declare any tax residence, filed no corporate income tax return, and paid no corporate income taxes to any national government for five years.” In addition, Ireland-based Apple Sales International generated $74B in sales income over four years but allegedly “paid taxes on only a tiny fraction of that income” after the company negotiated a deal with the government that enabled Apple to pay a tax rate of less than 2% vs the statutory rate of 12%. Read More »
Listen to (and share) Episode 32 of our audio podcast Deadline Big Media, as Deadline executive editor David Lieberman and host David Bloom discuss whether Netflix is about to take off or already has soared as high as it can; what to make of Apple’s massive stock buyback and dividend announcements; and disputes over whether Google Fiber is hurting Time Warner Cable and other competitors, even as Moody’s predicts heavy consolidation ahead for cable providers trying to lock down business clients.
Deadline Big Media, Episode 32 (MP3 format)
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Wish I could tell you what they are — but CEO Tim Cook offered sizzle without steak in his call with Wall Street analysts today after Apple reported its second-quarter earnings. He says that Apple will … Read More »
The consumer electronics company has more than doubled its stock repurchase program with plans to buy $100B of its shares by the end of 2015. “This is the largest share buyback of any company in history,” Apple CFO … Read More »
Shares are up about 5.2% in after-market trading. But there’s something for bulls and bears alike in the quarterly announcement — which Wall Street is closely watching following the 42% decline in Apple’s stock price since September. The company generated … Read More »
Pandora Media’s down 7.7% this afternoon after CNET reported that Apple is “close” to enlisting Universal Music and Warner Music for an iTunes-linked streaming service. Apple would make it easy for users to buy songs that they … Read More »
For those of you who can’t get enough iPhone news: The new model will be “similar in size and shape to [the] current one” and will go into production this quarter The Wall Street Journal reports citing … Read More »
Fandango Portobello Closes Up Shop In London
Sales and finance outfit Fandango Portobello has officially shuttered its London office, the company said on Twitter. Cineuropa reports that execs Janine Gold and Sarah Nuttall are exiting. Production operations will be … Read More »
Clock To Start Ticking For Indian ’24′
Slumdog Millionaire star Anil Kapoor is getting to work on the Indian version of the TV series 24. The actor, who was featured in the final season of Fox/20th TV’s real-time drama, will produce via his Anil Kapoor Film Co. He’ll also play the Jack Bauer character, now reportedly named Jai Singh Rathod, in the local take. According to BollywoodLife, production was due to kick off this week at Kapoor’s Stage 21 studio near Mumbai. Delhi Belly director Abhinay Deo is helming the series and Rensil D’Silva, who’s directing Sanjay Dutt’s Ungli, is scripting. The local broadcast partner is Viacom-owned Colors. Kapoor will next be seen on the big screen in Shootout At Wadala directed by Sanjay Gupta.
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David Bloom is a contributor to Deadline.
Samsung Mobile just unpacked its next flagship smartphone, christening it the Galaxy S4 and loading it with improved technical specs and nifty functions the company hopes might entice high-end users away from Apple’s iPhone and other competitors. Streamed lived to some 400,000 people over YouTube from New York City’s Radio City Music Hall, the Galaxy S4 announcement increases pressure on Apple and others to improve their own flagship smartphones, particularly to meet stiff competition in faster-growing overseas markets. Read More »
Relax, Android and Windows 8 users: CBS says you’ll get a similar smartphone and tablet app later this year. But Apple customers will be first to take advantage of the program which handles streamed full episodes of certain CBS shows, and so-called “second screen” features for people who are watching conventional live TV. The network says that its daytime and late night shows will be available within 24 hours after they air, and most primetime shows will be up after eight days. “We have been methodically and strategically finding new ways to satiate the appetite for our content on new platforms, while tapping into the tremendous revenue provided by doing so,” CBS chief Les Moonves says. “Our announcement today achieves both of these objectives, while protecting our very healthy current ecosystem.” By this fall’s TV season the new app will integrate features from the current CBS Connect App. Read More »
The judge in last year’s landmark Apple-Samsung patent case today slashed damages awarded to Apple last august from $1.05 billion to $598.9 million and ordered a new trial to recalculate the damages, CNET reported. Apple had actually gone back … Read More »
The apps for HBO GO and sister network Cinemax’s MAX GO have finalized a deal with Apple to make the services available on Apple’s AirPlay, which enables the channels’ subscribers to wirelessly stream programming from their iPhone, … Read More »
I don’t know whether investors and consumers would see an iWatch as a great leap forward, or a disappointment, considering how much the company has hyped the possibility of selling a revolutionary TV. But Apple … Read More »
They’ll have twice the maximum space of the current fourth-generation iPads, but they’re not for bargain hunters: The Wi-Fi-only model of the new 128GB iPad will carry a suggested retail price of $799, while the ones that also … Read More »
Listen to episode 20 of our audio podcast Deadline Big Media With David Lieberman. This week Deadline Executive Editor Lieberman and host David Bloom discuss Wall Street’s wildly different responses to Apple and Netflix earnings announcements; whether Fox should create a national sports network; and a very bad week in the business of games.
Deadline Big Media Episode 20 (MP3 format)
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That’s the question of the day for Apple followers as the company’s fans on Wall Street lick their wounds from last night’s disappointing earnings report. The stock fell 12.4% today to $450.50. That’s the company’s worst one-day performance in about four years, and puts Apple shares right where they were about year ago. The company’s market value of $423B is still impressive, but a far cry from late September around the time it released the iPhone 5. Back then, investors thought it was worth more than $659B. To put this into perspective, the drop in the perceived value of Apple over the last four months amounts to more than the value of Comcast, Disney, and Viacom combined. Read More »
UPDATE, 3:00 PM: CEO Tim Cook added fuel to the speculation that Apple will come up with a potentially game-changing television. In a call with analysts he said it “remains” a topic of “intense interest for us” adding … Read More »