Explaining Southern California's economy

Occidental Petroleum sees fourth quarter profits plunge

TO GO WITH AFP STORY: Commodities-oil-en

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Occidental Petroleum produced plenty of oil and gas in the fourth quarter of 2012, but heavy investments in the future of business and giving investors pause.

Occidental Petroleum, still based in Los Angeles, is still the biggest domestic player in the oil and gas business. But look out below! The company posted a massive drop in profits for the fourth quarter of 2012. 

As in really massive, down to $336 million from $1.6 billion in 2011 — nearly an 80 percent year-over-year plunge.

The decline was much bigger than Occidental’s third quarter slide of 20 percent. Some of the same problems are to blame: the cost of managing wells in California and heavy spending to improve the business.

Wall Street shrugged off the loss and pushed Oxy’s stock price higher in trading Thursday. And for what it's worth, Occidental set records for oil production in the quarter, continuing a trend.

But rumblings continue about whether the company should break apart its different businesses — and whether CEO Stephen Chazen, who took charge in 2011, is the right man for the job.

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Qualcomm beats Wall Street earnings expectations

2012 Consumer Electronics Show Showcases Latest Technology Innovations

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CEO Paul E. Jacobs of Qualcomm delivers a keynote address at the 2012 International Consumer Electronics Show. The San Diego company pleased Wall Street with its most recent earnings.

Qualcomm beat what the Street had anticipated, while bringing more than $6 billion in revenue in its first fiscal quarter. 

That was a nearly 30 percent increase over the same quarter a year ago. And of that, profit was $2.2 billion, which worked out to $1.26 per share, a figure that delighted analysts who had expected less.

The good numbers pushed the company’s stock immediately higher in after-hours trading on the Nasdaq exchange. 

This contrasts with Canada’s Research in Motion, whose new BlackBerry smartphones are powered by Qualcomm processors. RIM changed its name to “BlackBerry,” but the new edition devices haven’t (yet) reversed its fortunes. Its stock dipped as Qualcomm’s rose.

Qualcomm told investors to expect continued good results in 2013 — in the lexicon of finance, it upgraded its "guidance" — as the company rolls out new chips and benefits from more consumers upgrading to smartphones, especially in developing world markets like China.

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Avery Dennison racks up big quarterly profit, is selling office products unit for $500 million

Innovative labelmaker Avery Dennison of Pasadena is getting out of the office products business.

Hi-Liters and Marks-A-Lot makers will no longer be products that Pasadena-based Avery Dennison sells. The company reported earnings for the fourth quarter of 2012 — but also announced that it’s selling its office products division to Canada’s CCL, for $500 million in cash.

The deal has to be approved be regulators, but should be completed by mid-2013.

In that context, earnings were just frosting on the cake. Avery Dennison exceeded its 2011 profits for the same quarter by a huge margin: $49 million versus $22 million.

That’s impressive, given that revenue only rose by about 5 percent, to $1.53 billion for the quarter. 

Wall Street was pleased, pushing the stock price to highs not seen since 2011.

Follow Matthew DeBord and the DeBord Report on Twitter. And ask Matt questions at Quora.

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Apple earnings: Record iPhone and iPad sales, stock still drops. Why?

Apple Unveils Updated iPad In San Francisco

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Apple CEO Tim Cook speaks during an Apple product launch in San Francisco. Apple sold a record number of iOS devices in its fiscal quarter, but Wall Street was disappointed by profit margins.

Apple reported quarterly earnings for its first fiscal 2013 quarter on Wednesday after the markets closed. On the surface, the results were astonishing: Apple sold a record number of iPhones and iPads — 48 million and 23 million, respectively. It wasn't able to build enough iPad Minis to meet demand. It raked in $54.5 billion in revenue and netted a profit of $13.1 billion.

But. But. But...CEO Tim Cook set investors up for disappointment during his opening comments on an earnings call for analysts. "You're going to hear a lot of impressive numbers," he said. "But the most important thing to us is that customers love our products, not just buy them."

The numbers are monumentally impressive, but Cook emphasizes that in a weird way, Apple is now relying on customers' devotion to its products — and also to the Apple ecosystem that includes software like iTunes and new technologies like the Internet-based iCloud. Were the numbers somehow not impressive enough? Why the focus on soft values rather than on the bottom line?

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FAQ: Why today's Apple earnings aren't the most important the company has ever reported

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Apple reports quarterly earnings on Wednesday. Will they be strong enough to halt a stock price slide that began last year?

There's so much fretting around Apple right now that analysts, commenters, and Apple-ologists are calling today's quarterly financial results that'll hit after the markets close the mother of all earnings reports (Forbes is explicitly calling it that).

Why the high anxiety about the world's most valuable publicly traded company — and the most valuable California company by a substantial margin (Apple: $418 billion market cap; number two Google: $254 billion)? Simple: Analysts suspect that Apple's epic comeback story, from near bankruptcy to a mature company that's printing money with its monumental profit margins, is over. Nothing gold can stay, to borrow a line from a rustic American poet who never would have dreamed of an Age of iPhones but who would probably have been retroactively credited by Apple for his efforts to "Think different."

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