Stupidity is contagious. It gets us all from time to time. Even respectable companies can catch it. As I do every week, let's take a look at five dumb financial events this week that may make your head spin.
Day claims that her departure is a personal decision, but the move still caught the upscale retailer off guard. When a CEO steps down without a replacement in place, we're usually eyeing a boardroom battle behind the scenes, or a personal issue that has intensified.
Day's also stepping down from the board, so it's not merely about having more time. The yoga apparel retailer was starting to overcome its March fiasco, where it was stocking see-through pants; but this situation isn't as transparent.
Investors don't like the uncertainty, especially for a retailer that has historically commanded -- and earned -- a healthy market premium.
2. Xbox One -- but it didn't win
Microsoft (NASDAQ: MSFT ) had to feel pretty good heading into this week's E3.
Its Xbox 360 has been the country's best-selling video game console for the past two years, and that gives the software giant the inside track to lead the next generation.
However, the market wasn't entirely impressed with the $499 Xbox One price tag unveiled on Monday. Things got worse a few hours later; it was announced that the PS4 will hit the market at just $399.
Sony also won gamer cred by announcing that it wouldn't require online checks for disc-based games. Gamers will also be able to trade in, sell, or lend disc-based PS4 titles without restrictions imposed by Sony.
Even the high-tech Xbox One Kinect camera controller is being called into question given consumer concerns on surveillance and monitoring issues.
Shareholders asked some pretty pointless questions.
- Will the stock bounce back in a year or two?
- Why doesn't Facebook offer phone support for older users?
- Why is the news feed showing ads?
- Should investors form a committee to review Facebook's stance on public policy issues?
Were shareholders venting because the stock is trading 38% below last year's IPO price, or did Facebook hoodwink so many neophyte investors that don't understand that news feed ads are the way that the social networking giant is monetizing its free website, and that there's no way that CEO Mark Zuckerberg can guarantee a higher share price?
4. Apple fails to live up to the hype
I don't think that Apple (NASDAQ: AAPL ) executives realize how hot their seats are at the moment.
The consumer tech bellwether should've wowed the market when it kicked off this week's WWDC event on Monday. It didn't.
- The iOS 7 update is largely a matter of catching up to everybody else.
- iTunes Radio isn't much of a differentiator in a crowded streaming market, especially given Apple's earlier failure of Ping. and the slow start for iTunes Match.
- The cylinder-shaped Mac Pro was definitely a head-turning design, but PC sales aren't going to bounce back even if you make a computer in the form of a roll of toilet paper.
The market was certainly disappointed. It was holding out for more and, once again, it didn't happen. The stock was trading higher on Monday until Apple began talking. Then the stock moved lower on the news. It wound up closing lower on Monday, Tuesday, and Wednesday.
Earn the spotlight, Cupertino. Earn the spotlight.
5. Nokia misdials again
The Symbian experiment is apparently over for Nokia (NYSE: NOK ) .
The Financial Times is reporting that the Finnish handset giant will be abandoning the fading mobile operating system platform, focusing its smartphone attention on Windows Phone.
Nokia is getting paid good money to back Windows Phone, but things could have been so different if it had avoided its deal for Windows Phone, and thrown all of its weight behind Android, the way that larger rival Samsung has done.
Nokia argued that it would be receiving billions to support Windows Phone. If that's the case, why has Nokia posted losses in three of the past four quarters?
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