Wednesday, 23 January 2008

Apple forecasts below estimates

Apple expects to earn 94 cents a share on $6.8 billion (£3.4 billion) in sales for its second quarter. This forecast fell below analysts' consensus estimates for earnings of $1.09 (55p) a share on revenue of $6.99 billion (£3.5 billion). The outlook helped send Apple's shares down more than $17 ((£8.5) a share, or 11%, to $138.49 (£69.3) in after-hours trading.

For its fiscal first-quarter, Apple earned $1.58 billion (£790 million), or $1.76 (88p) a share, on revenue of $9.6 billion (£3.45 billion). During the same period a year ago, Apple earned $1 billion (£500 million), or $1.14 (57p) a share, on $7.12 billion (£3.56 billion) in sales.

The company attributed the quarter's performance to a strong holiday season, as Apple said that it sold 22 million iPods and 2.3 million Macintosh PCs during the quarter. Also, about 2.3 million iPhones were sold during the quarter. But even though Apple could point to items such as a 17% increase in iPod revenue and a 47% rise in its Mac sales from a year ago, some analysts felt the company should have done even better in light of recent revamps of the iMac and iPod product lines. (source: Market Watch)

It seems like the Financial Services Authority (FSA) is to examine the rules governing websites that compare insurance products. The issue is whether the act of ranking insurance products online by price constitutes giving financial advice. Some comparison websites are allowed by the financial watchdog to arrange insurance, but not to give advice. Traditional insurance brokers must meet strict regulations to give advice.

Rules covering so-called "electronic introduction" were designed before the development of comparison websites, and therefore did not provide appropriate protection for consumers. According to research commissioned by Biba, many price comparison websites use assumptions when generating quotes, something a third of consumers did not realise.

After interviewing a small sample of consumers, it said more than half of those questioned who had used price comparison websites felt the differences between insurance policies were not adequately explained. Only 6% felt sufficient policy details were given.

A spokesman for the FSA said it had looked at the question of comparison websites in the past. Richard Mason, director of comparison site, which is already fully authorised by the FSA, said he would welcome new guidance from the regulator, but accused Biba of exaggerating the scale of the problem.

Following its investigation, the FSA could take a range of actions including issuing revised guidance, enhanced supervision, or making changes to regulation. (source: BBC News)

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