iLounge

Apple on Friday announced that its board of directors has approved a two-for-one stock split that will increase the number of authorized common shares to 1.8 billion from 900 million. Apple said that each shareholder at the close of business on Feb. 18, 2005 will receive one additional share of stock for every share they own. Trading will begin on a split-adjusted basis on Feb. 28, 2005.

Shares of Apple have nearly quadrupled in value over the last year on the success of the iPod. Last month, the company easily beat analysts’ expectations with its first quarter financial results. Apple posted a net profit of $295 million, or 70 cents a share, compared to income of $63 million, or 17 cents per share, in the prior year. Analysts surveyed by Thomson First Call had expected the company to earn 49 cents a share.

Apple stock closed Thursday’s session down 38 cents at $78.36. It reached a 52-week high of $81.99 on Wednesday.

In an interview with Fortune, Apple CEO Steve Jobs answers the question of how the iPod has changed Apple. “It feels great,” Jobs says. “We’re having fun. Most of us can’t wait to get to work in the morning. But it’s not like Apple has somehow morphed into a mass-market consumer electronics company. Our DNA hasn’t changed. It’s that mass-market consumer electronics is turning into Apple.”

Jobs also discusses how young people are migrating to iPods and matching portable speakers from larger stereos made by electronics giants.

“You or I move into a new house, and the first thing we do is call the phone company to get our land line turned on. Kids, they just move in with their cell phones. Stereos are the same: Kids aren’t getting stereos; they’re getting speakers for their iPods,” Jobs says. “That’s become the audio market. People are buying iPods and Bose speakers instead of a JVC or Sony stereo system. And those guys have never come to us and said, ‘Could we work with you on the iPod?’ Some companies are prisoners of their point of view.”

Apple has been named the most influential brand in a poll of branding professionals thanks to its hugely popular iPod product line. Apple topped both the global and North American rankings in the survey of nearly 2,000 ad executives, brand managers and academics by Brandchannel, displacing search engine Google from last year’s top spot.

“Apple’s just done an extraordinary job with innovation, technology and design. The iPod is what has put Apple in the lead this year,” Brandchannel editor Robin Rusch said. “Sony has had less luck tying together its products as a lifestyle. From a branding perspective, they haven’t caught up with Apple’s design and ability to capture the imagination.”

Rounding out the top five were: Swedish furniture chain Ikea, premium coffee chain Starbucks, and Arabic media channel Al Jazeera.

Apple is looking for two interns for its iPod software team, according to new postings on the company’s jobs site. “The iPod SW Platform team is seeking an enthusiastic intern. This position requires a self-motivated, flexible individual with strong technical and communication skills who can contribute in a team environment.” Apple said duties may include: development of testing tools and automated testing solutions; prototyping new features and capabilities; bug isolation and reporting; and writing and managing test cases.

Speaking with iLounge at last week’s Macworld Expo in San Francisco, Apple representatives noted that the company has posted new tutorials for the iPod, iPod mini, and iPod shuffle on its web site. In addition to being visually attractive, the tutorials have become increasingly useful and easy to understand.

Apple on Wednesday posted its highest quarterly revenue and net income in the company’s history thanks to strong holiday sales of iPods. Apple greatly exceeded Wall Street expectations with a net profit of $295 million, or 70 cents a share, for its fiscal 2005 first quarter ended December 25, 2004. Revenue for the quarter was $3.49 billion, up 74 percent from $2 billion in the year-ago quarter.

Along with its record earnings, Apple released several iPod and music sales details. The company reported that it sold more than 4,580,000 iPods during the quarter, representing a 525 percent increase in iPod units compared to this time last year. All iPod models brought in more than $1.2 billion in revenue for Apple during the quarter. Apple’s music division, which includes the iTunes Music Store, iPod services and accessories, accounted for $177 million of the first-quarter’s revenue, a 277 percent increase year-over-year.

Apparently in response to the release of these financial results, Apple’s stock (Nasdaq:  AAPL) is up an impressive 11.82% to 73.20 in after-hours trading.

Forbes senior editor Lisa DiCarlo and Boston attorney Bruce Sunstein have spoken out on Apple’s recent lawsuit against Mac rumor site Think Secret, which has recently posted reports on upcoming Apple products such as a low-cost iMac, a productivity suite, and a flash-based iPod. “It is widely acknowledged that Apple enjoys the kind of slavish devotion among its customers—and fawning adoration from the press—of which other companies don’t even dare to dream,” writes DiCarlo. “That is, it’s acknowledged by everyone but Apple. How else to explain Apple’s latest attempt to clamp down on, rather than embrace, its fanatical fans?” Sunstein, who specializes in intellectual property law, said the case will only result in damage to Apple’s reputation. “A fair amount of buzz doesn’t hurt Apple’s business,” he said. “And, to the extent that Apple sues its customer base; it has to think twice about biting the hand that feeds it.”

A displeased customer of Apple’s iTunes Music Store is suing the company, alleging it broke antitrust laws by allowing songs purchased from the store to only work with the iPod, shutting out competitors. “The suit was filed on Monday in the U.S. District Court in San Jose,” reports Reuters. “One antitrust expert called it a long shot, but Californian Thomas Slattery is hoping for unspecified damages for being ‘forced’ to buy an iPod. The key to such a lawsuit would be convincing a court that a single product brand like iTunes is a market in itself separate from the rest of the online music market, according to Ernest Gellhorn, an antitrust law professor at George Mason University. There is legal precedent for such claims, but courts usually conclude competing products as viable alternatives, Gellhorn said.”

Apple is suing unnamed individuals who leaked details about an unannounced product by posting detailed information on the Web. Apple’s complaint, which was filed with the Santa Clara County California Superior Court on Dec. 13, alleges that “an unidentified individual, acting alone or in concert with others, has recently misappropriated and disseminated through Web sites confidential information about an unreleased Apple product.” Apple said it did not know the “true names or capacities, whether individual, associate, corporate or otherwise,” of the defendants, but that it would amend the complaint once they have been discovered.

Apple and Motorola could soon unveil the mobile phone they have been developing to play music from Apple’s iTunes Music Store. “We’ve said we have something coming on this in the first half of 2005 and we’re definitely on schedule for that. Hopefully you’ll be able to see more about it soon,” Eddy Cue, vice president of applications at Apple, told Forbes. “What we’ve talked about is a something that is valuable for the mass market,” Cue said. “It has to be a phone in the middle-tier of the market, not a $500-tier phone. It has to be very seamless to use. And we’re very happy with the results.”

In addition to raising his price target on Apple stock to $65 from $53, Fulcrum Global Partners analyst Robert Cihra increased his estimates on iPod sales in Apple’s current quarter to 4 million from 2.9 million. Cihra also said that the iPod would account for 33 percent of the quarter’s revenue, up from 13 percent a year ago. Earlier today, Piper Jaffray raised its price target on Apple to $100 from $52, citing a definite “halo effect” among iPod owners.

Piper Jaffray raised its target price on Apple stock to $100 from $52, citing a “halo effect” from satisfied iPod users. The firm said that in a survey of 200 users, 6 percent were former PC users who have purchased a Mac after becoming an iPod owner, while 7 percent were former PC users who plan to buy a Mac within the next 12 months. “We believe that the remarkable satisfaction with the iPod creates a word-of-mouth wildfire that generates new customer interest in Apple products,” Piper Jaffray said.

While Apple CEO Steve Jobs calls the iPod the “Walkman of the 21st century,” Microsoft and its allies are hoping to make it the Betamax of the 21st century, according to a report in the New York Times. “The iPod dominates its market in a way that no Apple product has done in a generation, raising the possibility that the company is becoming more than just a purveyor of computers with high design and low market share. If Apple continues to ride the wave of consumer electronics products, it may become the Sony of the 21st century. For that to happen, however, Jobs must do what he failed to do last time: prevail over his old nemesis, Bill Gates, who sees entertainment as Microsoft’s next great frontier. Microsoft is working hard to make sure that the iPod is less like the Walkman and more like the Betamax, Sony’s videocassette format that was defeated in the marketplace by VHS.”

MacMinute reports: “Apple’s new iPod Store has added product ratings, allowing customers to submit reviews and rate products from one to five stars. Strangely, users can only review third-party products—all Apple gear is automatically given a ‘5-Apple rating’ because the company says “we think they’re great.” In the frequently asked questions of the reviews program, Apple tells why customers can’t rate Apple products: ‘Would you trust us to display less than perfect ratings on our own products? We didn’t think so!’”

Apple has posted a QuickTime stream of today’s music event starring Apple’s CEO, Steve Jobs introducing the new iPod Photo, Special Edition U2 iPod and more. “Steve Jobs, Bono, and The Edge invite you to watch a special event at the California Theatre in San Jose, CA.” Bono and The Edge performed “Vertigo” and another new song from their upcoming album “How to Dismantle An Atomic Bomb” due November 23.

MacMinute reports that yet another sign that the iPod is quickly becoming the main focus at Apple, the company has launched the online iPod Store. Similar in design as the online Apple Store, the dedicated iPod Store features the iPod family (iPod, iPod mini, iPod Photo, U2 iPod), iPod accessories, iPod Top Sellers, shopping guides (car, home, Mac or PC, on the go), and much more.

MacMinute reports that Apple has sent out an invitation to select media announcing a special event to be held next week at San Jose’s California Theater. The event appears to be music related as the invite reads: “Steve Jobs, Bono and The Edge invite you to a special event.” Bono and The Edge are of course members of the popular rock band U2, who are featured in Apple’s latest iPod+iTunes commercial performing their new single “Vertigo.” The song is also available exclusively through Apple’s iTunes Music Store. During Apple’s fourth quarter conference call last week, CFO Peter Oppenheimer said that Apple and U2 would be working together more “in the coming weeks.”

Apple today announced financial results for its fiscal 2004 fourth quarter ended September 25, 2004. Apple shipped 2,016,000 iPods during the quarter, representing a 500 percent increase in iPods over the year-ago quarter. Apples’ Q4 financial conference call with financial analysts and press also mentioned several iPod and iTunes related highlights. (Source MacMinute.com)

• Music based revenue grew 370%
• 2,016,000 iPods shipped, up 500% ($537 million)
• $98 million from iTunes Music Store and other iPod-related services/gear
• HP-branded iPod accounted for 6% of all iPods sold
• More European stores coming this month

Apple CEO, Steve Jobs was interviewed by BusinessWeek on the subject of innovation. Many companies have tightened their belts and cutback R&D, but not Apple, it forges ahead.