The Wall Street Journal noted this morning that Apple's Asian suppliers have been given the green light, and are beginning production on the 7.85-inch tablet, as Apple seeks to fend off competition in the tablet space.
Previously Apple had been against producing a smaller tablet, with former CEO Steve Jobs saying the screen size wouldn't do justice to the company's iOS software. Internal documents last year, however, suggested a shift in Apple's attitude.
Just as Apple continues to dominate the consumer electronics space, though, HP's (HPQ - Get Report) feeling the burn, with shares plunging 8.99% to $15.59. HP CEO Meg Whitman held a conference call with analysts today, and the company cut its 2013 fiscal outlook during the event. CFO Cathie Lesjak told analysts HP expects to earn between $3.40 and $3.60 a share, well below Wall Street's estimate of $4.18 a share. "I have said from the beginning that this is a four to five year journey," Whitman said during the meeting. "2013 is a fix and rebuild year - we will be working through the disruptions from the necessary changes we made in 2012." HP expects to complete its restructuring by the end of fiscal 2014, and by 2016, Whitman said she believes revenue will grow in line with GDP, with operating profits growing faster than revenue.
MetroPCS (PCS) shares were scalped, losing 9.8% to $12.24 as the company announced it's merging with T-Mobile USA, the U.S. unit of Deutsche Telekom. The combined company will use T-Mobile's branding and have 42.5 million subscribers. The deal is structured in a very complex way. "The transaction is structured as a recapitalization, in which MetroPCS will declare a 1 for 2 reverse stock split, make a cash payment of $1.5 billion to its shareholders (approximately $4.09 per share prior to the reverse stock split) and acquire all of T-Mobile's capital stock by issuing to Deutsche Telekom 74% of MetroPCS' common stock on a pro forma basis," the press release said. "Deutsche Telekom has also agreed to roll its existing intercompany debt into new $15 billion senior unsecured notes of the combined company, provide the combined company with a $500 million unsecured revolving credit facility and provide a $5.5 billion backstop commitment for certain MetroPCS third-party financing transactions." Interested in more on Apple? See TheStreet Ratings' report card for this stock. -- Written by Chris Ciaccia in New York >Contact by Email. Follow @Commodity_Bull
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