Wednesday 25 January 2012

Apple surges, Yahoo slumps

Apple are one of the few sure things in these uncertain economic times but even they surpassed themselves this week.

Shares soared after strong demand for iPhones and iPads lead them to report a 73 per cent rise in quarterly revenue to $46.33 billion, comfortably beating Wall Street analyst estimates. Net profit rose 118 per cent to $13.06 billion.

In stark contrast, Yahoo reported a drop in net revenue and profit for the fourth quarter, just days after co-founder Jerry Yang resigned from the company. New chief executive Scott Thompson said Yahoo needs to "do better" and "get innovative products that matter into the market." He joined from PayPal (where he was president) earlier this year, an appointment which raised many eyebrows, not least at the online payments outfit with John Donahoe, interim president, describing his resignation as a shock.

There's a scene in the Willy Russell play, Educating Rita, where university lecturer Frank asks his student Rita to leave England behind and move to Australia with him, remarking: "It would be good to leave a country that's finishing for one that's beginning." That quote came to mind when I first heard of Thompson's departure from PayPal, although the reverse is true in this case. That is, leave a company where business is booming and the future holds all kind of possibilities and join one that has all the signs of a sinking ship.

BTW, our friends at Retail Systems have provided a glimpse into PayPal's future - the move by the company into the bricks and mortar world.

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