Comcast reports a slight dip in sales and mixed subscription numbers. Microsoft
NEWS AT A GLANCE
Comcast profits slip, revenue rises
Comcast, the No. 1 U.S. cable TV company, reported a 12.5 percent fall in quarterly profits, to $732 million. Revenue at its TV, Internet, and digital phone services all rose, as customers spent more on services, but the number of basic cable TV subscribers fell and Internet growth slowed. (AP in Yahoo! Finance) Still, “it’s a very solid report,” said analyst David Joyce at Miller Tabak & Co. “Everything is in line with what we expected, if not a little bit better.” (Bloomberg) Separately, Comcast competitor Cablevision is preparing a $650 million bid for the New York daily Newsday, besting two other offers, The Wall Street Journal reported. (AP in BusinessWeek.com)
Microsoft stays in Yahoo! holding pattern
Microsoft’s board met on the company’s next step regarding its proposed takeover of Yahoo!, but failed to reach a decision, according to news media reports. (The New York Times) CEO Steve Ballmer reportedly signaled that Microsoft could raise its bid to $33 a share, from $31 (now worth about $29 a share, due to a drop in Microsoft stock), but Yahoo! is seeking a price in the high $30s. (Reuters) If it doesn’t raise its price, Microsoft could wage a proxy fight or walk away from the deal. But “Steve Ballmer’s not the sort of person who runs away from a fight,” said BGC Partners analyst David Buik. “He likes to take things head-on.” (Bloomberg)
Starbucks meets lowered expectations
Coffee powerhouse Starbucks reported a 28 percent drop in quarterly profits, to $108.7 million, meeting recently lowered expectations. Starbucks said charges relating to CEO Howard Schultz’s efforts to reinvigorate the company weighed on profits, as did the economic slowdown and higher milk prices. (AP in Yahoo! Finance) The company is cutting its U.S. store openings. But according to internal research, customers aren’t leaving Starbucks for competitors like Dunkin’ Donuts and McDonald’s, they are just spending less. Starbucks “has, over time, been an affordable luxury,” Schultz said. “And at this time, it isn’t for some people.” (Reuters)
Record gas prices, in perspective
Gas prices are hitting record highs in the U.S., but filling your tank is still much more expensive elsewhere. U.S. gas prices were recently ranked the 45th cheapest, out of 155 countries examined. The comparisons aren’t exact, but $3.45 a gallon holds up favorably to $8 a gallon in Europe, $12.03 in Aruba, and $18.42 in Sierra Leone. And the fact that gas sells for 12 cents a gallon in Venezuela is, like the high prices elsewhere, due to government subsidies or taxes. The 18 cent U.S. federal gas tax is pretty low, comparitively. That has helped fuel our love affair with cars, said Robert Lang at Virginia Tech. “Nobody sang ‘She’ll have fun fun fun until her daddy takes the tokens away.’” (CNNMoney.com)
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