Last week, the technology sector remained a hot bed of activity despite the uneasiness of the looming fiscal cliff. Holiday consumer spending remains swift, benefiting the gadget makers. At the same time, deals are getting done and the overall improving outlook has promoted some tech firms to expand production. While the cliff continues to be the big issue facing the overall markets, the tech sector seems to be ready to face it with resolve. Now here's your tech related news and events that occurred in the last week.
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All Things Apple
America's favorite innovative gadget firm Apple (Nasdaq:AAPL) was in the news plenty last week - for both positive and negative things. First up, is the company's recent decision to begin building computers here in the United States. The concept of onshoring or re-shoring jobs has gained steam as a variety of companies have taken advantage of skilled workers in the U.S. and low energy prices. Apple said it would invest $100 million in producing some of its Mac computers, beyond the assembly work it already does in the U.S. Not to be outdone, Foxconn (OTC:FXCNY) - the company that does most of Apple's building in China - announced it might shift some of its production to the U.S. as well. While some critics have called these announcements PR moves, any additional jobs in the U.S. economy will be welcomed.
Meanwhile, the news did little to stop Apple's stock slide. The former market darling has been drifting lower and lower as analysts weigh in on concerns facing its dominate position in the mobile and tablet PC space. New offerings from Microsoft (Nasdaq:MSFT) and Google (Nasdaq:GOOG) have finally begun to chip away at Apple's market share.
Marissa Mayer Scores Again
Aging search and Internet portal Yahoo! (Nasdaq:YHOO) continues with its amazing turn round as new CEO Marissa Mayer cleans house. First, the tech stalwart has announced a deal with Comcast's (Nasdaq:CMCSA) NBC Sports. The deal will combine Yahoo's web-based sports reporting with NBC's television and digital resources in an effort to collaborate on major sporting events on both TV and the web.
Yahoo! also announced a major shift in how the Internet giant sells online advertising. The firm will now move from ad sales organization to a "category" model. That means its sales reps will sell all of Yahoo's ad products - as well as its search offerings - in a vertical process organized around big market areas. This includes "topics" like tech, women or its popular finance offerings. This "category" model is a direct take on how Google does it. All in all, that should help the tech giant regain its search crown or at least boost its free cash flow.
Netflix's Social Blunder
While Netflix (Nasdaq:NFLX) CEO Reed Hastings didn't post lurid photos or inflammatory rants on his Facebook (Nasdaq:FB) page, but he still is in a little bit of hot water over one of his postings. The SEC is investigating a post from July 5 in which Hastings reported that Netflix customers were viewing nearly 1 billion hours of video content a month. This echoed a similar statement on the firm's blog a month before.
The posting was widely reported by tech bloggers and the firm's stock rose 13% the day of the posting. However, the company never issued a formal press release or made a separate filing. That fact has Hastings and the video service in hot water with the SEC.
Overall, the move represents a unique situation for the SEC in regulating social media and could set a precedent on how other companies run blogs or Twitter streams.
Finally, in a positive sign for the global economy, contract chip maker TSMC (Nasdaq:TSM) reported that its sales in November rose 23.9% from a year earlier. The producer makes semiconductors for a host of device makers, consumer products and electronic products. That's a bullish sign that consumers and business could finally be starting to spend again.
The Bottom Line
While the fiscal cliff rules most headlines, the tech sector continues to make headlines of its own. Despite plenty of uncertainty in the sector, there have been plenty of positives. Higher sales have pushed many firms to begin expanding their production, while social media continues to be a game changer. As the year winds down, investors should expect more of the same.
At the time of writing, Aaron Levitt did not own any shares in any company mentioned in this article.