Tech Business Roundup: Dell Gives Up on Smartphones, Apple Owns the S&P

Shares of Best Buy (NYSE:BBY) rose early but fell later as its fourth quarter numbers and plans were revealed. Year-to-year domestic segment online revenue grew by 21 percent, and U.S. comparable store sales of tablets and eReaders each grew by low triple digits. Stocks initially jumped at the news of planned cost reductions by fiscal year 2015, but as investors took in the falling same-stores sales number (down 2.4 percent with a flat gross margin), shares fell sharply. Also downplayed by investors was the announced plan to attain $850 million in cost reductions by closing 50 big box stores in fiscal year 2013, to be replaced by the launching of 100 small format stand-alone mobile stores. Finally, the report projects fiscal year 2013 sales of $50 billion to $51 billion versus a $51.84 billion consensus, and guidance of earnings per share of $3.50 to $3.80, versus a $3.70 consensus.

Don’t Miss: Best Buy is Shrinking.

AOL (NYSE:AOL) gets a bad rap from patent-advisory firm M-Cam, which advises that AOL’s IP portfolio would bring $290 million, an amount far lower than MDB Capital’s assessment of $1 billion. M-Ca, also remarked that “most of AOL’s patents are not commercially viable, or are junk grade.” However, shareholder Starboard Value counters that the portfolio could generate as much in licensing income.

Even though Michael Dell remains optimistic in his projections involving Dell’s (NASDAQ:DELL) upcoming Windows 8 (NASDAQ:MSFT) tablets, the company’s mobile device efforts do not seem to go anywhere. A few months ago Dell shut down it Streak Android tablet line, and now sales of its Venue and Venue Pro smartphones in the U.S. have ceased, leaving thousands of company employees owning Venues in the lurch.

Investing Insights: Dell Just Waved This White Flag.

Toshiba (TOSBF.PK) and Micron (NASDAQ:MU) both want to sponsor Elpida Memory’s recovery from bankruptcy. The winning firm will be selected in May, and that company could acquire Elpida, given terms acceptable to both sides. Word is, that Intel (NASDAQ:INTC) may also be interested.

Is this hype, or is Apple’s (NASDAQ:AAPL) effect on the S&P 500 and the overall market this large? Barclays analysts estimate that Apple comprised 15 percent of the S&P 500’s 12 percent rise this year, “contributing over four times its weight in the index”. However, Barclays sees “concentration risk” from Apple in the numbers, calculating that if the giant were removed from the S&P, the index might be left with a ‘rather weak earnings period’.

Don’t Miss: Is Apple Signalling Something New About China?

To contact the reporter on this story: Mark Lawson at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com