Tech Business Roundup: Apple’s Big Bite, Facebook’s Phone Chatter

Apple’s (NASDAQ:AAPL) fiscal second quarter beat, which was propelled by huge sales in China and by expansion of its margins, is causing plenty of chatter and reactions. For starters, Topeka Capital’s Brian White raises the share’s price target to $1,111, after his previous target of $1,001 just three weeks ago. Shares are trading at 8.1 times (ex-cash) his 2013 estimate, for which he forecasts a new iPhone, Apple TV, iPad Mini, and a likely iPhone deal with China Mobile (NYSE:CHL) as sustaining the upwards tide. Goldman predicts that the report implies higher long term margins, but BMO is more cautious, saying that Apple’s quarter-to-quarter drop in phone sales could mean flatter sales until the next iPhone is launched in the summer. Further, Apple’s first quarter profit was larger that Google’s (NASDAQ:GOOG) revenue for the same period, says Henry Blodget, who thinks that the iPhone alone might comprise the most profitable business in the world. Similarly, Dan Frommer remarks that the iPad, with 17 percent of sales, is not bigger than Mac with 13 percent. Finally (for the moment) Horace Deidu shows that Apple’s operating margin grown with a factor of three since the fourth quarter of 2005, thanks to the iPhone’s amazing margins.

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The Facebook (FB) phone could come as soon as the third quarter, says Digitimes. The phone will feature a custom version of Android, and it’s also reported that FB is working on it with HTC. At the same time, Google (NASDAQ:GOOG) says it will work with Samsung for its next Nexus phone, which could worsen the worries of Motorola Mobility (NYSE:MMI) investors, though Google has confirmed that its Nexus projects would remain open to third parties.

AT&T’s (NYSE:T) proposed spectrum transfers to T-Mobile USA (DTEGY.PK) gets an okay from the FCC. The transfer is a component of the $4 billion merger breakup fee paid by AT&T to T-Mobile, and should help the latter to implement its 4G investment program. At the same time, that company is asking the FCC to disallow
Verizon’s spectrum purchases.

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Shares of Motorola Solutions (NYSE:MSI) (which is not being sold to Google), reach new 52-week highs after its first quarter results exceed consensus. The figures benefitted from sales to the government, which outweighed a 2 percent fall in enterprise sales. The firm issued second quarter revenue guidance of $2.18 billion and earnings per share of between 65 and 70 cents, which beats the Street forecasts of $2.1 billion and 68 cents respectively, and also reaffirms its outlook for the current year.

Silicon Labs (NASDAQ:SLAB) on Wednesday defied the upwards trend for chips stocks, by selling off after a positive first quarter report that exceeded estimates, and a guidance for second quarter revenue of between $129.5 million and $134.5 million that beat a $129.7 million consensus. The selloff is being blamed on chatter that SLAB might opt out of a large growth initiative concerning its touch controllers for smartphones, due to tough Asian competition.

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