|
|
ONLINE FEATURES
Book Reviews
BW Video
Columnists
Interactive Gallery
Newsletters
Past Covers
Philanthropy
Podcasts
Special Reports
BLOGS
Auto Beat
Bangalore Tigers
Blogspotting
Brand New Day
Byte of the Apple
Economics Unbound
Eye on Asia
Fine On Media
Green Biz
Hot Property
Investing Insights
Management IQ
NEXT: Innovation
NussbaumOnDesign
Tech Beat
Working Parents
TECHNOLOGY
J.D. Power Ratings
Product Reviews
Tech Stats
Wildstrom: Tech Maven
AUTOS
Home Page
Auto Reviews
Classic Cars
Car Care & Safety
Hybrids
INNOVATION
& DESIGN Home Page Architecture Brand Equity Auto Design Game Room SMALLBIZ Smart Answers Success Stories Today's Tip INVESTING Investing: Europe Annual Reports BW 50 S&P Picks & Pans Stock Screeners Free S&P Stock Report SCOREBOARDS Hot Growth 100 Mutual Funds Info Tech 100 S&P 500 B-SCHOOLS Undergrad Programs MBA Blogs MBA Profiles MBA Rankings Who's Hiring Grads | |
AUGUST 8, 2005
Edited by Monica Gagnier HEADLINER Jeff Bezos: Now Comes The Flood  For the past four quarters, Amazon.com (AMZN
) CEO Jeffrey Bezos has disappointed Wall Street with tepid earnings, a cautious outlook, or both. Not this time. Although higher income taxes cut net profit from a year ago, the e-tailer beat expectations, as operating profits rose 21%, to $104 million, on sales of $1.75 billion. Amazon also hiked profit and sales forecasts for the year. Investors responded by bidding up its shares by 12%, to $42.45, on July 27.What was behind the surprise? Free-shipping offers and sales by other merchants, from Target Stores to mom-and-pop outfits. Highly profitable fees from those merchant services, which Amazon combines with revenues from a credit-card offer, doubled for the second quarter in a row, to $50 million. Bezos is hardly home free, though. Tech costs shot up 49%, and he added three new distribution centers recently to handle growth. But the latest results hint that maybe, just maybe, Bezos' ambitious strategy could pay off. By Robert D. Hof Oracle's Bank Shot Just months after it planted a flag in the retailing software market with its acquisition of Retek, software giant Oracle (ORCL ) is on the move again. It's in talks to buy Citigroup's (C ) 43% stake in i-flex Solutions of India, one of the world's leading banking software suppliers, according to a source familiar with the talks. If Oracle succeeds in buying Citicorp's share, it is expected later to acquire a controlling interest in the publicly traded company. Oracle is bolstering its presence in industry-specific software to get a leg up in its battle with corporate applications rival SAP.   Who's Who In Happy Meals  Ronald McDonald has a new sweetie. After linking up with Walt Disney (DIS
) in 1996 in a 10-year exclusive cross-marketing deal, McDonald's (MCD
) said on July 27 that it will hook up with rival animation studio DreamWorks (DWA
) in 2007. The two-year pact will commence with the release of Shrek III and could be extended. The partnership is likely to bruise Burger King, which used Shrek and its first sequel to boost kids' traffic. As for Disney, the impact isn't as clear. McDonald's executives say they still might promote Disney characters after their contract expires at the end of 2006. But they also say they will no longer be tied down to a single partner. Indeed, Ronald is flirting with Pixar, too.A Generic Juggernaut Generic drugs may not be sexy, but they're certainly hot. Teva Pharmaceutical Industries (TEVA ) on July 25 acquired Ivax (IVX ) for $7.4 billion in cash and stock, marrying two of the world's top makers of generic drugs. Nearly $40 billion worth of branded drugs are slated to go generic in the next two years, and Israel-based Teva is now in prime position to grab a chunk of the new business. The newlyweds could get a big boost from insurance companies and the upcoming Medicare prescription-drug program -- both of which are expected to push the idea of inexpensive generics to patients. Investors pushed shares of Miami-based Ivax up 11.2%, to $25.45, in the two days following the merger. Teva's shares stayed relatively flat at $31.92. Misspent Energy? Breaking a long logjam, on July 26, House and Senate conferees agreed on the final details of a sweeping energy bill. The measure reduces the chances of another blackout by mandating reliability standards for the grid. It requires more efficient air conditioners and other appliances, and it includes tax breaks or incentives for everything from hybrid cars and nuclear energy to wind and solar power. But the majority of the $14.5 billion in tax subsidies go to increasing supplies of oil, gas, and electricity and boosting coal use. That's why Democrats and enviros say it's a giveaway to big energy companies and won't reduce America's dependence on oil imports or spur renewable fuels. The full House and Senate are expected to approve the bill quickly. Et Cetera... -- Dupont (DD ) lowered its 2005 earnings forecast, due in part to higher energy costs. -- Lockheed Martin's (LMT ) net earnings soared 56% to $461 million on a 6% rise in sales to $9.3 billion. -- GMAC (GM ) will sell Bank of America (BAC ) $55 billion in auto loans over the next five years. Closing Bell: Corning  Shares of Corning (GLW
) rose 5.3% to $19.17, on July 27, their highest level since the telecom bubble burst in 2001. Strong sales of the company's liquid-crystal-display glass for flat-panel TVs and computer monitors helped push up second-quarter earnings 53%.
| | |
 Copyright 2005, by The McGraw-Hill Companies Inc. All rights reserved.Terms of Use | Privacy Notice |
Printer-Friendly Version