tv Nightly Business Report PBS January 31, 2017 4:59pm-5:29pm PST
reported a strong quarter. apple beat both on earnings and sales estimates and perhaps more importantly, it reported a rise in iphone sales after three straight quarters of decline. and it cited strong demand for the newest version of its most popular product, the i have phone 7. apple earned $3.36 a share. a full 15 cents better than wall street forecasted. overall revenue, up 3% to a record $78 billion in just three months time. and investors like what they saw sending shares higher in after hours trading. josh has more on apple results. >> 78.3 million. that was the big number in apple's latest quarterly report. it was first to the number of iphone units in the quarter. that was better than expected.
the street had been at 77.4 million. all the talk of apple pay, apple music. the iphone does re9 flagship product. i did have a chance to speak briefly with tim cook. he said it was a dynamite quarter for the iphone. he pointed out specifically in the u.s., japan, western europe, as well as emerging markets like bras and i will russia. as for looking ahead, i asked why the optimism for the iphone in the quarters ahead. he said he had confidence in the current product lineup. he points to strengths like india where it has relatively low penetration. still, it had an all time record revenue. and about the pipeline, cook saying we are very excited about the pipeline i did ask him, certain skeptics point out certain changes coming in the fall will be necessarily evolutionary in nature.
emwell, they don't work here. cooper teupertino cupertino, california. >> what he sees for the coil, he is principal portfolio adviseoring tim, welcome. nice to have you here. >> nice to be here. >> it was almost like apple saying, take that. the iphone is doing well. what did you think of the report? >> i thought it was good report. you had a bead on earnings and revenue and iphone number. certainly, the forward guidance was conservative as apple tends to be. i'm not sure apple thinks as quarter to quarter as the public does. so apple ma'a apple maps out their products years in advance. i guess they're resting easier in cupertino tonight. it was a really nice number. >> what is next for them? >> i think the iphone has shown
that looking forward, you have software as a service. rather than necessarily needing a device, you'll have, whether it be awarable, your phone or something else. that essentially tells whatever device you're near that you're near it and delivering your services. and apple has been delivering that for a long time with iphone and it bleeds over into the watch and the home kit where you'll have the internet connected devices running on apple software. you'll bleed over into the car where you'll have apple's car play software your digital life for you. so i think it has a long way to go. >> you said something interesting a moment ago. up apple has a plan. it doesn't look at the time line the way some investors look at the time line. isn't that an appropriate way to run a company? special lay technology company. >> absolutely. the advances in technology need
to come along with the advances. you can have a plan for what you want to do in five years but you need to know what hardware will be available to do that. that's why they have these long term road maps. i think apple has done a really nice job. they're very good stewards of capital. they have a net balance larger than most companies is that they've been advancing for the future. so as a manager of a company, we think they've done extraordinarily well. >> on that note, tim, thank you very much. apple's numbers were quite nice. so far earnings have not been able, as an aggregate to provide investors with clarity on the strength of the economy. that seems to have stalled the stock market rally along with the concern that political drama may be overshadowing the push for pro growth policies. today dow closed down triple digits for the second consecutive day. off 107 points to 19,864.
nasdaq up a little bit. the s&p 500 dropped for a fourth consecutive session. the three indexes, the nasdaq rose the most. up about 4%. dow component exxonmobil saw the products fall nearly 40%. though the results would have been better if a $2 billion impairment charge was excluded. persist tently low oil prices in the refining business brought down earnings. revenue was higher but that wasn't enough to list the shares which fell in trading today. >> pfizer reported disappointing quarterly profits. the flagship vaccine and higher expenses. the company also issued a down beat sales outlook and said it expects to lose billions in revenue as some of its drugs lose exclusive sales rights. there was a bright spot. the revenue for the most recent quarter was better than expected. >> the kroflt of pfizer was on
his company's analyst call. his peers were at the white house meeting with president trump. the president called on them on manufacture more of their drugs in the u.s. while vowing to cut taxes and roll back regulations. that helped lift stocks with identifieser and merck finishing higher on the day. >> he said the pharmaceutical industry is getting away with murder and pledged to bring drug prices down. today president donald trump struck a gentler went to the pharmaceutical industry. as leaders of the some of the biggest companies were summoned to the white house. >> you're doing a great job over the years but we have to get prices down for a lot of reasons. you have no choice. for medicare, medicaid. we have to get the prices way down. >> drug prices were still topic number one. the president also pledged to reduce regulations, improve u.s. taxes and accelerate drug approvals at the fda. >> you're going to get your
products either approved or not approved. it will be a quick process. it won't take 15 years. >> in return, many emphasize their commitment to the u.s. from amgen to pharma giant merck. >> we'll be adding 1,600 jobs this year. >> you may have heard we have a drug that stimulates the immune system to kill cancer. we're bringing jobs here. >> shares rose. >> i think we've seen a pattern where president trump talks very tough in public. when he gets had private with these business leaders, he likes to make nice. he is a deal maker. i think what you heard was softening ofly position on drug prices and a willing tobs give tax breaks and help with regulatory issues. i'm not sure this is an industry
he is trying to change. >> did he focus on the food and drug administration saying he has a fantastic person he'll be naming soon to streamline the industry. many have already praised the fda for accelerating the process leading some to wonder if the administration will strike the right balance between proving it works and it is safe. in addition to naming someone to head up the fda, he is scheduled to announce tonight his choice of supreme court. it is likely to be one of two judges. gorsuch's judicial philosophy is considered similar to antonin scalia. hardiman is considered a law and order judge. >> has it all between fast for the stock market?
welcome. good you have to with us. let me ask by twisting the question just a little bit. and i wonder whether this is something that has the market a little perplexed. can an administration be pro business, avowedly so, aggressively so on the one hand, and also, pro protectionism at the same time? >> you know, that's a great question and it is one investors will have to wrestle with. this is all new territory for both the president and a stock market to see that kind of dynamic to play together. i think if you start really a specter of a protectionist president, this is uncharted territory. we haven't had a trade war in a while. pits spector out there. it has people excited. the less regulatory overhang and some of the other things president trump has talked about. the more you talk about a protectionist environment with the kind of trade partners we
have, the more uncharted territory. the more we find out those facts. people sell and ask questions and then they decide to go later. >> we have seen executive orders on regulations. are you one who thinks he should be talking more from the market standpoint about. at a reform and things like that? instead of perhaps the immigration side of things? >> i think the market certainly appreciates what president trump stands for as it relates to the protectionist side. as it relates. on the immigration side, i think the kind of speed with which those orders came out, the timing they came out and then other text that came out about who knew what when, is not what the market is used to and not what investors are used. to it is the reaction has been muted to be down in the last couple days with the news we had. i think it is kind impressive.
we've seen more have these executive orders and more of what i like the call ready fire aim politics. the more the market will be a little less, more susceptible. >> so it seems like what you're saying, it may not be the speed as much as the nature of the presentation, and that things have not rolled out as smoothly and they've caused an uproar in some areas. >> i think they have. we watched over the week with the rallies and the rally cries. everybody was either watching twitter or the facebook feed which is probably good for those stocks. but it was keeping people over the weekend in a place they're not used to which is seeing actions friday night ask watching over the weekend. i think you're going on see that tempary little bit. i think there's enough behind closed doors. when the president ds to listen to that uproar is a question to be seen. i think the odds are we won't
see as many of those. this is a back lash that we haven't seen in a very long time. >> okay. thank you very much. the federal reserve today began its two-day meeting on interest rate policy. whale a rate increase is likely to be announced tomorrow, according to a new survey, there is one thing that economists and money managers see as a threat to the recovery. >> the cnbc fed survey for january finds a lot of support for the new policies of the trump administration but one huge concern. take a look here. individual tax cuts supported by 75%. business tax cuts by 80% or more. and then deregulation is the favorite of the 41 respondents. economists, fund managers, but more than 80% have a negative view on donald trump's trade
policies and that overshadows a lot of the good stuff. that may be why it comes down a little bit 82. % ascribe the market rally to policy. that's down. and think about, it is down to 26%. it is why these economists and fund managers think it is too optimistic. 56% saying. 39% saying they are realistic. we look at the biggest threats, take a look at the history of the series of questions we have. back in i am a 2012, 37% thought the european financial crisis was the biggest threat. 41% off the fiscal cliff in july 2012. global economic weakness, you remember early last year. extent markets into a swoon. 44% thought that was the biggest threat to the economy. now 51%, the first time we've had a majority focus a single threat to the expansion here.
in the history of this survey. 51% saying, protectionism is the biggest threat. for "nightly business report." >> by the way, nearly all the responsibilitients in the survey say they will keep interest rates on hold when it releases its policy statement tomorrow. money managers predict three rate increases this year with the next move likely to come at the june meeting. still ahead, shares of under armour plunge. is the growth story over for this one time wall street darling? under armour is stumbling.
they are seeing the profits erode and sales slide and it may not change soon. the departure of the chief financial officer and you have a stock that lost 25% in trading today. >> lots of alarm bells are when it comes to under armour. as slowing growth pushes it further behind the global giants it wants to compete with like nike and adidas. under armour grew by 12%. the first time it was less than 20 ners more than six years. this time they cut the sales forecast by more than half a billion dollars to 5.4 billion. the stock now down more than 50% in a year. the culprit, steep price cuts, according to ceo kevin plank. >> slower traffic caused significant activities, earlier, deeper and broader than expected. this was some of our basic core product that sold through for us
in years past. this in addition to higher demand for more lifestyle silhouettes caused us to be out of balance. >> lifestyle hasn't been add go life to under armour's numbers. they have been offering performance measuring gear, think fit bit but those sales have lagged. they were hoping to attract millennial buyers by spending on sponsorships with the likes of tom brady and steph curry to create its own brand. a big payoff that has yet to pay out. and company like sports authority declaring bankruptcy, under armour has fewer places to sell its products. and they announce the ceo will be leaving at the end of the week after only a year on the job. there will be another acting cfo with the company looking the reaccelerate in a choppy retail
market. under armour isn't only competing with coils like nike and adidas. kohl's and even luxury brand chanel are now selling their own lifestyle apparel brands. >> would it seem like a slam-dunk. delivery companies should benefit. the largest package delivery company, ups, it missed expectations. it issued weak guidance about the zput that pressured shares today. so why didn't ups get a big lift in online shopping? >> packages may have made in it time for christmas but ups failed on deliver for investors. the big culprit, the gang busters growth of ecommerce. >> weighed good fourth quarter. what we saw was a tremendous shift in the amount of volume that went to the consumer versus the business. we looked over the last ten years and this is the fastest rate of change.
so volume continued to grow. opportunity continued to grow. we saw the impact account. as consumer turned to the internet to buy more and more goods, delivery company are scrambling to keep up. ups moved an overwhelming 12 million packages over the holiday season. 16% more than 2015. including 2.5 million new addresses. higher volume put more strain on the network and more pressure on marmi margins. it is much costlier to deliver individual packages to individual doorsteps. ups is doubling down. the plan to spend a billion dollars, a third more than last year, to automate facilities and expand capacity. it is also raising prices. while it is accelerated, this trend has played out in earnings before. one reason they rate it a hold.
>> this company either takes advantage of the market and gets tons of volume and unable to get things delivered on time. then it says, we won't complete happen again. we'll spend money on infrastructure and technology, people, and the following year, it gets things delivered on time of but it spends so much money it doesn't result in the margins. >> it was impacted by weak industrial production ask a strong dollar. the company expected growth in the u.s. this year is that managele says, it looks forward to working with a trump administration. as tax reform and infrastructure spending and new bilateral trade agreements. i'm morgan brennan. >> higher premiums help etna top premiums. are lower medical costs also help overall of profit was hurt by higher restructuring cost and
after a federal judge blocked the proposed $30 billion takeover of humana take over. it isn't giving up just yet. >> i think one of the things we have to consider, we have until february 15th to make the decision, that's when the agreement ends. we believe this combination will provide a better product for seniors. a better product for the medicaid population. more affordable and simpler. >> etna shares were up more than 1% to 118.61. ely lilly said strong demand for diabetes medications. shares were up 3% to 77 the.03. sprint's subscriber growth topped expectations and beat its rivals at&t and verizon. it was the most in four years.
on the earnings front, they posted a narrower net loss but it was still wider than expected. it sent shares up 12% to $9.23. >> an increase in customer spending during holidays listed results. the company did miss revenue targets. mastercard also warned the dollar would hurt revenue growth and net profit this year. that sent shares nearly 3% lower at 106.33. the hand bag maker coach said the strong dollar would cause revenue growth to slow this year. the company saw its quarterly profit beat expectations, thanks to strong demand for its pricier 1941 collection. and strong overseas sales. the same store sales beat estimates. shares were up nearly 4% at 37.35. coming up, fixing our
nation's airports. >> in salt lake city, utah, they're building a brand new airport. why are not more cities doing this? that story coming up. san francisco has become the first city to challenge president trump's order over sanctuary cities. it directs the federal government on withhold money from cities that do not cooperate with immigration officials. if san francisco does not comply, it could lose more than $1 billion. the lawsuit calls the order unconstitutional. one reason for the recent optimism on wall street is the expectations that billions of dollars will ultimately be spent on fixing america's
infrastructure. that includes dozens of airports that are overcrowded, inefficient, and in need of being either renovated or replaced. in salt lake city they're already building a new one. here's a look at the long runway for approving a new airport to getting it up in the air. 90 into salt lake city and you'll find an airport that looks far better than others in america. but underneath it is straining. with twice as many. right next on old terminals, salt lake is building an all new airport. the cost? $2.9 billion. >> there's a planning process, an environmental process, there the actual construction process you have to go through. in many cases, airports, you end up with the same foot print you're occupying.
so you're trying to remodel the kitchen while you're trying to cook thanksgiving dinner. >> phase one won't be done until 2020 when it is completely finished in 2023, even more people will fly into utah's capital. the number of people flying in the u.s. keeps soaring. there are more flights, more congestion and more talk about fixing manager's airports will have to include aleve yaigt traffic jams on the tarmac. >> there's a huge amount of money that's needed to invest in airport material naturals. but also on the runways. we need more runways. a great terminal isn't great if you can't land. >> it is estimated fixing all of manager's airports could cost up to $75 billion. more money than what congress is likely to authorize. so airlines like delta are stepping up. it is investing in new material naturals club its hub in salt
lake city. >> security, gate boarding, it will all be revamped in a way that reduces stress, reduces variability and creates a more service oriented and less stressful experience. >> and investment in the future of travel as more americans than ever take to the sky. "nightly business report." salt lake city. >> that's "nightly business report." thank you for joining us. >> thank you. have a great evening. we'll see you right back here tomorrow night.
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