Apple filed its annual 10-K report with the SEC on Wednesday, and the numbers include a significant increase in research and development expenses, growing $952 million—now $3.38 billion from $2.43 billion last year, an increase of roughly 40%. The company now has 72,800 full-time employees, and 390 retail stores averaging $51.5 million in annual revenue. It expects to open 30 to 35 new stores in 2013, “with approximately three-quarters located outside of the U.S.”
The report also reveals that Peter Oppenheimer was appointed Principal Accounting Officer of Apple. Former Senior VP of iOS Scott Forstall’s new position is officially titled Special Advisor to the Chief Executive Officer, similar to a title Tony Fadell was given before he transitioned out of Apple to start Nest.
Shots of the device and its packaging are included — in addition to photos comparing the iPad mini’s packaging to the full-sized iPad and its packaging. The Lightning cable can be seen as well, though there are notably no pictures of the power adapter, which has remained somewhat ambiguous since the device’s announcement.
iPhone 5 is closer to launching in China, as two models have been approved for use on Chinese mobile networks by State Radio Management, Chinese blog Sina Tech reports. The A1429 model can support the networks of China Unicom and China Mobile, while the A1442 model supports China Telecom’s network. There’s long been speculation that Apple could finally reach a deal with China Mobile — China’s largest mobile carrier. Once the iPhone 5 secures a network-access license, it can be sold in China. No launch date has been announced as of yet. [via CNET]
Apple’s major announcement late Monday that Senior Vice President of iOS Software Scott Forstall and retail chief John Browett were leaving the company has already led to early reports and speculation on what prompted the departures. A report from Fortune suggests that Forstall’s fate was sealed by his refusal to sign Apple’s apology letter for the launch of Maps, an iOS 6 feature that was met with worldwide ridicule after its launch. Ultimately, the letter to customers was only signed by Apple CEO Tim Cook.
It’s also said that Forstall didn’t get along with Apple Senior Vice President of Industrial Design Jonathan Ive, as well as other Apple employees. The New York Times reports that Forstall and Ive wouldn’t sit in the same meeting room together, and that Forstall would insert himself into product development beyond his role at Apple. Ive is now listed as chief of human interface at Apple — initial speculation suggests that Apple will move away from skeuomorphic design, which Forstall supported.
As Forstall transitions out of the company, he will remain an advisor to Cook until “next year.” As the Times noted, the mood at Apple was apparently positive regarding Forstall’s departure. GigaOM reports that “Forstall’s firing was met with a sense of quiet jubilation, especially among people who worked in the engineering groups.” It’s also noted that Forstall’s exit was “fairly last minute and not something he initiated.” Browett’s exit from Apple was not nearly as unexpected, given well-publicized issues with his leadership of the retail division, and the company searches for a new head of retail to take his place.
In a stunning and unexpected press release at the end of the business day, Apple has announced that Senior Vice President of iOS Software Scott Forstall and retail chief John Browett are leaving Apple, apparently as the result of issues that have been widely publicized over the past year.
A long-time Apple employee whose work with former CEO Steve Jobs dated back to their time at NeXT, Forstall was previously referred to as Apple’s “CEO in waiting,” in reference to his close relationship with Jobs, somewhat similar temperament, and focus on minute details of human interface design. Loosely attributed reports in business publications claimed that Forstall was difficult to work with, and suggested that a number of key Apple employees had departed the company following disputes with him. Additional reports noted that a battle was brewing inside Apple regarding the company’s modern, clean-lined hardware, and skeuomorphic software interfaces that were thought by some to be visually distracting or busy. Complaints regarding the reliability of Siri and Maps, two marquee features introduced by Forstall for iOS 5 and iOS 6, respectively, have also been widespread.
Browett was hired by Apple to lead the retail division following the departure of Ron Johnson, who left to become CEO of J.C. Penney’s. A veteran of British retail, Browett’s brief term was marked by complaints from retail workers regarding poor morale and short-sighted cost-cutting efforts that compromised the Apple Store experience.
According to Apple, Jonathan Ive will take on leadership and direction for human interface design across the company, adding former Forstall software “look and feel” responsibilities to his role as Apple’s industrial design chief. Eddy Cue will become responsible for Siri and Maps, apparently taking over those online services from Scott Forstall. Craig Federighi will become responsible for iOS and OS X, and Bob Mansfield will lead a new Technologies group, leading all of Apple’s wireless and semiconductor teams. Apple is now searching for a “new head of Retail,” and in the interim, the Retail team will report to CEO Tim Cook. The full Apple press release is reposted after the break.
As the East Coast of the United States prepares for Hurricane Sandy, Apple stores are attempting to limit possible damage from the storm. Stores in five states and Washington DC have been closed, according to ifoAppleStore.com, and roughly 50 Apple stores are within or near Sandy’s landfall precaution zone. Notably, New York City’s below-ground Fifth Avenue storefront has been lined with sandbags, and inside, the display table products have been wrapped in plastic. Some other stores in the landfall zone are being similarly protected.
Our best wishes go out to all the people who have already been impacted by the hurricane, as well as those who are currently in its path.
A Facebook post questioning AT&T’s restrictions on FaceTime over Cellular has gone viral, racking up more than 690,000 “likes” and more than 51,000 comments as of this writing. In a Facebook post directed at AT&T, a customer named Wynter Farmer notes her disappointment with AT&T forcing customers to switch to a more expensive, limited data plan in order to use FaceTime over Cellular on the iPhone 5. “In order for FaceTime to be used without WiFi a Family Share Plan is required. That plan has limited data. It took me a second to wrap my head around that,” Farmer wrote, noting that she currently has an unlimited data plan.
The post ends with Farmer writing, “If AT&T doesn’t delete this post please like it to show them you also think it is an underhanded, unfair and despicable way to treat their loyal customers.” The post was written on Oct. 14 and is still racking up comments and likes by the minute, illustrating that user anger over AT&T’s restrictions has not subsided.
Apple has increased the prices of apps sold in Europe due to exchange rates, ComputerWorld notes. The minimum price for an app purchased in the Euro zone is now €0.89 —about $1.15 — up from €0.79. Apple takes about 39 percent of each sale, while developers get roughly 61 percent. “From time to time Apple adjusts prices of products in countries due to changes in exchange rates,” Apple spokesman Alan Hely said in an email.
Also, more app buyers can now make purchases in their local currencies instead of U.S. dollars. Local currencies supported in the App Store now include Russian rubles, Turkish lira, Indian rupees, Indonesian rupiah, Israeli shekels, Saudi Arabian riyals, South African rand, United Arab Emirates dirhams, and Danish kroner.
Apple’s white and silver iPad mini is currently listed as available to ship in two weeks, according to Apple’s website. MacRumors noted that the white and silver mini’s shipping date changed to two weeks within the first 17 minutes of its release. The black and slate iPad mini is still listed for delivery on Nov. 2 as of this writing, at least within the United States.
Some customers of iPad minis with Wi-Fi and Cellular have seen a delivery date of Nov. 23 via standard shipping, according to 9to5Mac, while others report a delivery date of Nov. 21 with expedited shipping. Apple’s web site only lists the LTE models as shipping in mid-November, and the company originally noted that it expected to ship them a couple of weeks after the Wi-Fi versions; it’s possible that the Nov. 21 and 23 dates come from second shipments.
Updated Oct. 29: The black and slate Wi-Fi iPad mini is also listed as available to ship in two weeks on Apple’s website after its first shipment sold out over the weekend. Both the black and white Wi-Fi versions of the new fourth-generation iPad are currently listed as available to ship in one week. The Wi-Fi and Cellular versions of the two new tablets still show shipping availability as “mid-November.”
Although Apple was ordered by a U.K. court to publicize a finding that Samsung’s Galaxy had not infringed the iPad’s design, Apple used the opportunity to take a few jabs at its rival, as well as to undermine the international value of the court’s findings. The company posted a page quoting the judge’s original ruling, noting that the iPad “is a cool design” while the Samsung Galaxy tablets “are not as cool.” Added to the end of the court-required disclosures are Apple’s court victories over Samsung in Germany and the U.S., concluding, “So while the U.K. court did not find Samsung guilty of infringement, other courts have recognized that in the course of creating its Galaxy tablet, Samsung willfully copied Apple’s far more popular iPad.” Posted as a link at the bottom of Apple’s U.K. website, the entire statement can be read here.
During Apple’s fourth quarter 2012 financial results conference call, Apple CEO Tim Cook and CFO Peter Oppenheimer made a number of comments related to Apple’s iPhone, iPad, and iPod businesses.
Peter Oppenheimer, Apple’s CFO, noted that the iPod touch continued to account for over 50% of iPods sold, and continues to account for 70% of market share, according to NPD. This is despite declines in overall iPod sales.
Oppenheimer also noted that the demand for the iPhone 5 continues to outstrip supply and the company continues to work as hard as it can to get an iPhone into the hands of every customer who wants one.
Additional details are available by clicking on the title of this article.
Reporting its fourth quarter 2012 financial results today, Apple said it sold 26.9 million iPhones in the quarter, a 58 percent increase year-over-year, up somewhat from 26 million units in the prior quarter. Apple sold 14 million iPads during the quarter, up 26 percent from the year-ago quarter but down from 17 million units in the third quarter of 2012. Finally, the company said it sold 5.3 million iPods during the quarter — a 19 percent decrease compared to the same quarter last year. Unit sales of iPhones, iPads, and iPods bring the cumulative totals for the three device categories to 271 million, 98.08 million, and 356.38 million, respectively, though Apple did note at a media event several days ago that iPad sales have since surpassed the 100 million mark.
Apple posted revenue of $35.97 billion and net quarterly profit of $8.2 billion, or $8.67 per diluted share, compared with revenue of $28.27 billion and net quarterly profit of $6.62 billion, or $7.05 per diluted share in Q4 2011. Revenue from Other Music Related Products and Services, which includes revenue from the iTunes Store, App Store, and iBookstore in addition to sales of iPod services and Apple-branded and third-party iPod accessories, was 2.29 billion for the quarter, up 43 percent year-over-year and 29 percent from the prior quarter. Apple’s Board of Directors also declared a cash dividend of $2.65 per share of the Company’s common stock. The dividend is payable on November 15, 2012, to shareholders of record as of the close of business on November 12, 2012.
“We’re very proud to end a fantastic fiscal year with record September quarter results,” said Tim Cook, Apple’s CEO. “We’re entering this holiday season with the best iPhone, iPad, Mac and iPod products ever, and we remain very confident in our new product pipeline.”
“We’re pleased to have generated over $41 billion in net income and over $50 billion in operating cash flow in fiscal 2012,” said Peter Oppenheimer, Apple’s CFO. “Looking ahead to the first fiscal quarter of 2013, we expect revenue of about $52 billion and diluted earnings per share of about $11.75.”
Bloomberg reports that Apple is currently negotiating with major record labels to launch an ad-supported Internet radio service within the first three months of 2013. Previously rumored, the service is said to be similar to those offered by Pandora and others, although it will allow users more flexibility as to what they hear. According to the report, advertising revenues have weighed heavily in the negotiations, as the labels are seeking a percentage of ad sales, while Apple wants to grow its iAd platform.
All but lost in the shuffle of major new Apple product releases this week was the new 12W USB Power Adapter, which as noted in our earlier story is designed to work with iPads and a number of other recent iPod and iPhone models. The 12W Adapter is an updated version of the 10W USB Power Adapter shipped with all previous iPads, and will be bundled with the fourth-generation iPad and iPad mini, as well as purchased separately for $19. According to 9to5Mac, Apple has confirmed that the adapter will charge previous iPads faster than the older 10W adapter, stating that “[w]e don’t have an exact percentage of how much faster it would charge but you should see an increase in speed.”
Calculations run by iLounge suggest that the 12W Adapter could shave off up to two hours of charging time for the third-generation iPad, which notably took 7 or more hours to refuel. It’s unclear how much of an improvement will be seen by older iPads, as well as the iPad mini, which has roughly one-third the battery capacity of current full-sized models.
Samsung infringed four Apple patents, according to a ruling by U.S. International Trade Commission Judge Thomas Pender, Bloomberg reports. Among the infringements are a design patent for the front face of the iPhone, and another for touchscreen technology co-invented by Steve Jobs. The findings are subject to review by the trade commission, which should finish its investigation by Feb. 25. An import ban of certain Samsung products is a possibility.
The other two infringements from the ruling include a patent involving translucent images for applications displayed on a screen, and a patent that detects when a headset is plugged in. Wednesday’s patent news saw mixed results for Samsung, as the company won a Dutch court dispute, but was revealed to be the subject of an antitrust law investigation by the U.S. Department of Justice. As Bloomberg notes, Samsung has been more successful against Apple outside of the U.S. In the U.K., Apple must run ads stating that Samsung has not copied the design of its iPad due to a recent appeal ruling.
Apple has posted detailed official dimensional drawings for the iPad mini — Wi-Fi and Wi-Fi + Cellular versions — on its website, and has done the same for the fourth-generation iPad (Wi-Fi and Wi-Fi + Cellular).
All of the documents are available through Apple’s developer portal. Although they don’t reveal any new information, the measurements enable accessory designers to proceed with their new products, particularly cases that depend upon precise measurements. Apple released drawings for the iPhone 5, new iPod touch, and new iPod nano in September.
In response to early criticisms of the iPad mini’s $329 starting price tag, Apple marketing chief Phil Schiller told Reuters that consumers will see the iPad mini as a premium product worthy of its price when compared to similar $199 products like Google’s Nexus 7 and Amazon’s Kindle Fire HD. “The iPad is far and away the most successful product in its category. The most affordable product we’ve made so far was $399 and people were choosing that over those devices,” Schiller said. “…And now you can get a device that’s even more affordable at $329 in this great new form, and I think a lot of customers are going to be very excited about that.”
Multiple sources are reporting that some Apple retail stores are offering recent third-generation iPad customers the opportunity to exchange their device for the new fourth-generation iPad. CNET reports that some stores are allowing the exchange for customers who purchased their third-generation iPad within the past 30 days, and ZDNet reports the same thing is happening in the U.K. Both reports claim that the exchanges are being offered selectively on a store-by-store basis, so readers are encouraged to check if their local Apple stores have made the same decision. The usual return policy is 14 days.
The release of the new iPad prompted immediate concerns from customers on the matter, considering it has completely replaced the third-generation iPad, which was only released about seven months ago. Apple’s iPad support forums are full of users wondering if they can make the exchange. There has been no official word from Apple.
Apple and Samsung’s ongoing patent war has taken another two turns, as Samsung won a Dutch court decision, but is now being investigated by the Department of Justice in the U.S. Reuters reports that a Dutch court has ruled Samsung does not infringe on an Apple patent involving multi-touch: using two fingers at a time on the touch screens of some Samsung smartphones and tablets does not constitute an infringement, according to the court.
Back in the U.S., however, the Department of Justice is investigating whether Samsung violated antitrust law through possible misuse of essential wireless patents, Dow Jones reports, a detail revealed by Apple in a legal document. Although the DOJ has not commented on the investigation, a source notes the probe has been ongoing for several months. Apple maintains that some of Samsung’s standard-essential patents are being offered on unfair terms. [via CNET]
Apple announced a major new upgrade to iBooks for the iPhone, iPad and iPod touch during today’s special event. The new version features an optional continuous scrolling mode for reading, sharing of information via e-mail, Facebook and Twitter and support for over 40 languages, including Korean, Chinese and Japanese, including appropriate font styles and page turning directions. iCloud integration has also been improved, effectively providing users with easier access to their iBookstore purchases in iCloud directly on their virtual bookshelf. The iBooks update is expected to be available on the App Store later today as a free download.
Updated: iBooks 3 has been released.