Apple might be building a Google competitor, Audible adds more podcasts and an ad measurement company raises $350 million. Apple has a growing interest in search technology and might even be working on a product to compete with Google, according to The Financial Times. The most visible change is the fact that in iOS 14, Apple is now showing its own results when you type queries in the home screen.
(Bloomberg) -- ServiceNow Inc. projected subscription sales in the current quarter that narrowly topped Wall Street estimates, signaling that companies are continuing to invest in upgrading their business workflow software while employees remain stuck at home.Subscription revenue will be $1.15 billion to $1.16 billion in the period ending in December, the Santa Clara, California-based company said Wednesday in a statement. Analysts, on average, estimated $1.13 billion. The company raised its fiscal-year subscription sales forecast to as much as $4.26 billion from about $4.23 billion.Chief Executive Officer Bill McDermott has pledged to turn 17-year-old ServiceNow into a “software juggernaut.” The company has a plan to reach $10 billion in revenue, on an unspecified time frame, from selling applications that help companies organize their personnel, customer service and IT operations and transition to more online work. Like rival Salesforce.com Inc., ServiceNow has offered clients a set of software tools to help them safely return to their offices during the coronavirus pandemic.Shares rose more than 3% in extended trading after closing at $484.05 in New York. The stock has climbed 71% this year.In the third quarter, ServiceNow reported subscription revenue increased 31% to $1.09 billion, compared with analysts’ estimate of $1.06 billion. Total sales increased 30% to $1.15 billion in the period ended Sept. 30. Profit, excluding some items, was $1.21 a share. Analysts projected $1.03.ServiceNow also appointed Apple Inc. executive Larry Jackson to its board of directors, now enlarged to 11 seats. Jackson, the global creative director of Apple Music, will be ServiceNow’s first Black director. McDermott said in a statement that Jackson would bring a focus on customer experience to the board.The software maker earlier Wednesday said it named Gabrielle Toledano, previously of Keystone Strategy LLC and Comcast Ventures, as chief talent officer effective in January.“Covid is redefining the future of work, accelerating digital transformation and amplifying the need to unify systems, silos, and processes,” McDermott said in the statement. “Customers are leveraging the Now Platform to create the workflows that deliver great experiences for heroic veterans, students, knowledge workers, consumers, and so many others worldwide.”(Updates with company appointments beginning in the sixth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- For weeks, warnings that elevated tech-stock valuations could cause a violent selloff bubbled beneath the surface. On Wednesday, they looked prescient.U.S. stocks tumbled the most since June with rising virus cases threatening the economic recovery. More than $2 trillion has been wiped from the value of American equities this week and Wall Street’s fear gauge spiked to the highest in four months.Big tech companies from Apple Inc. to Amazon.com Inc. led the rout, their shares having gotten so expensive relative to expected earnings that further price gains became hard to justify. Software giant SAP SE set off alarms on future profit when it warned revenue would suffer well into 2021. A day later, U.S. tech darlings exacerbated market volatility for the second time in two months after a summer of gains that outpaced the broader market’s advance by 10 times.“There’s uncertainty around the coronavirus surrounding the impact of another wave of shutdowns,” Matt Maley, chief market strategist at Miller Tabak + Co., said by phone. “If one of these other tech companies talks about lockdowns affecting their earnings in 2021 the way SAP did, we’ll have a big problem.”The S&P 500 fell 3.5% to close at the lowest in five weeks. Tech shares in the gauge sank 4.3%. Alphabet Inc. and Facebook Inc. lost more than 5%. The VIX jumped almost seven points to close above 40.The worry over future earnings is spiking just as big tech lines up to report results. Investors punished Microsoft Corp. even though its third-quarter profit beat expectations and its forecast was mostly in line with estimates. The stock plunged more than 4%.Up next are the other four of the market’s five biggest constituents that have a combined $5 trillion in market cap. Apple, Amazon, Facebook and Alphabet all report Thursday after the close. All are expected to show a strong third calendar quarter, but the focus will be on how they see the end of 2020 and the start of next year.“Because tech has supported the market’s rally in 2020, the earnings of those big tech companies are going to really drive sentiment,” said Chris Gaffney, president of world markets at TIAA Bank. “The risk is that it could drive it in a negative way and add on like a snowball rolling downhill to this selloff.”Buyers had piled into the tech giants for the safety provided by their strong balance sheets and products that cater to stay-at-home demand. They stayed with them as the economy rebounded because of their size advantage. But with the virus rampaging and Congress unlikely to shore up the economy with an aid package, speculation has mounted that tech earnings won’t be able to meet lofty expectations.That’d be fodder for bears like David Einhorn, who called an “enormous” bubble in tech stocks and said his firm has added bearish wagers. The big top for tech stocks may have occurred on Sept. 2, according to the president of Greenlight Capital, who cited a surge in trading of call options and a growing industry concentration among signs of excessive euphoria. Since then, the tech-heavy Nasdaq 100 has plunged almost 10%.“Bubbles tend to topple under their own weight. Everybody is in,” Einhorn wrote in an Oct. 27 letter to investors. Greenlight has adjusted the portfolio of companies it’s wagering against by adding a fresh so-called bubble basket of mostly “second-tier companies and recent IPOs trading at remarkable valuations,” he added, without identifying specific stocks.Usually earnings tend to calm the market during periods of stress. But not this time. Among S&P 500 companies that have disclosed results, 85% beat analyst estimates and are on pace for the best showing since Bloomberg began tracking the data in 1993. That’s doing little to excite buyers who have watched the index rallying as much as 60% from its March trough and valuations reaching levels not seen since the dot-com bubble.On the contrary, traders are taking profits off the table. As a result, shares of companies in the S&P 500 reporting quarterly earnings have dropped 0.8%, on average, the next day. Tech shares have fared the worst, falling 2.7%, data compiled by Bloomberg showed.“The stock reaction tomorrow from AMZN, FB, GOOG and AAPL will be telling as to whether tech can keep up this dramatic pace of outperformance,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group, referring to the tickers of the tech giants. “A regime change is at hand as valuations begin to contract.”Tech firms have yet to prove that the boost in businesses during the pandemic is not fleeting. Microsoft gave a second-quarter forecast for revenue in some divisions that fell short of the highest analysts’ projections. Earlier this month, Intel Corp. reported a surprise drop in sales of chips for data centers, potentially signaling a drop-off in demand for expansion of the server farms that underpin cloud-computing services. Netflix Inc. missed Wall Street’s estimates for subscribers, renewing doubts about its ability to maintain growth as pandemic lockdowns go away and competition intensifies.“There is no question that these companies have great business models, have executed well and stand to benefit from how the economy is reshaping itself, but there are questions about if they have gone too fast, too far,” Peter Tchir, head of macro strategy at Academy Securities. “Parabolic valuation increases can only be justified by extremely strong guidance. A lot of great companies have seen incredible gains in their stock prices.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.