Cook: Apple ‘Open to Acquisitions of Any Size’

Apple reportedly pursued Time Warner Inc.
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Apple is “open” to acquisitions both big and small, so long as it has a strategic fit, company CEO Tim Cook said Tuesday on Apple’s fiscal Q4 earnings call.

“We are open to acquisitions of any size that are of strategic value where we can deliver better products to our customers and innovate more,” Cook said. “We look at a whole variety of companies and, based on that, we choose whether to move forward or not.”

Cook was responding to a question on whether Apple would consider an acquisition that is “larger than normal.” Potential M&A targets weren’t mentioned by name, but the question was obviously about a The Wall Street Journal report that Apple had approached Time Warner about a merger a few months ago, but that those talks didn’t get beyond the “preliminary stage.” That report came out late last week when rumors of an AT&T-Time Warner courtship were flying. AT&T and TW announced a proposed merger on Saturday (Oct. 22).

Later on the call, Cook later confirmed that “television has an intense interested with me and many other people here.”

And he also acknowledged Apple’s move into original content. “I think it's a great opportunity for us both from a creation point of view and an ownership point of view,” Cook said.

Apple posted Q4 revenues of $46.9 billion, and net income of $9 billion, or $1.67 per diluted share. It expects fiscal Q1 revenue of $76 billion to $78 billion

In Q4, Apple continued to see a decline in device shipments. 

The company shipped 45.51 million iPhones in the period, down 5% year-on-year, though an improvement versus the past two quarters.

Apple hopes to rekindle smartphone growth with the new iPhone 7 line. Cook said demand for the new product is outstripping supply, especially for the iPhone 7 Plus.  Total iPhone sales were up in 33 of Apple’s top 40 markets worldwide in Q4, Cook said.

Apple also shipped 9.26 million iPads in the period, down 6% from the year-ago period.

On the smart home front, Cook said Apple expects there to be 100 HomeKit-compatible products on the market by year-end.

Cook sidestepped a question about Apple’s rumored connected car strategy.

“We look for ways [where] we can improve the customer experience on different sets of products. We're always looking at new things,” he said. “There’s a lot of technologies that will either become available …or will be able to revolutionize the car experience…It’s  interesting from that point of view.”

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