:00:00. > :00:21.Shares in the tech giant slide, as it reports its first fall
:00:22. > :00:26.The biggest fine in US automotive history.
:00:27. > :00:32.Volkswagen agrees to pay $14.7 billion over its diesel emissions
:00:33. > :00:42.scandal, and there could be more to come.
:00:43. > :00:44.Welcome to World Business Report, I'm Sally Bundock.
:00:45. > :00:47.Also in the programme: How are the two giants
:00:48. > :00:50.Boeing and Airbus report their latest earnings today.
:00:51. > :00:52.We get an expert view on what they will reveal.
:00:53. > :00:58.Could there be a problem with Apple's core?
:00:59. > :01:01.The world's biggest tech company has reported its results for the last
:01:02. > :01:04.year, and they don't make for pleasant reading.
:01:05. > :01:07.It is the first time since 2001 that the darling of Wall Street has
:01:08. > :01:11.posted a decline in annual revenue, ending one of the hottest corporate
:01:12. > :01:19.If we take a look at its sales numbers, Apple's net sales in 2016
:01:20. > :01:26.That is a huge number, but it is a fall of 8% compared
:01:27. > :01:35.A fall in iPhones sales for the third quarter in a row
:01:36. > :01:38.is one of the key reasons why Apple's numbers are not
:01:39. > :01:51.In the last three months, Apple sold more than 45 million iPhones.
:01:52. > :01:54.That is better than expected, and it is important to note
:01:55. > :01:57.the new iPhone seven was launched after this last quarter ended.
:01:58. > :02:00.When looking at profits, in the last quarter they made $9 billion.
:02:01. > :02:03.That is a fall of 19% compared to the same time last year.
:02:04. > :02:07.Some analysts say this is a sign of a saturated a smartphone market.
:02:08. > :02:10.Revenue from China, which is seen as a growth market,
:02:11. > :02:15.In many ways, it has been a difficult year for Apple.
:02:16. > :02:17.In August, the European Commission ruled that the company owed
:02:18. > :02:29.the Irish Government $14.5 billion in back taxes.
:02:30. > :02:37.With me is Jason Mander, director of research at GlobalWebIndex.
:02:38. > :02:44.Good morning. So it does sound, doesn't it, like they have had a
:02:45. > :02:48.really tough quarter and a tough year. Give us your take on the
:02:49. > :02:53.numbers. Let's not forget they are still making a huge amount of money,
:02:54. > :02:58.but a lot is being based on the promise of what is to come and China
:02:59. > :03:02.is down by a big number. They are pointing to other markets including
:03:03. > :03:06.India, where they are seeing lots of promise. Sales have not been what
:03:07. > :03:10.they could have been but the iPhone seven is yet to make an impact and
:03:11. > :03:15.there are renewed Macs coming on Tuesday as well. They are seeing
:03:16. > :03:21.increases in their services department, so things like Apple Pay
:03:22. > :03:26.and Apple Music are good news for them, as it suggests they can
:03:27. > :03:30.extract more revenue from their existing user base even if hardware
:03:31. > :03:34.sales are not as exciting as people would want to see. There is this new
:03:35. > :03:39.opportunity coming from the services division. The other opportunity is
:03:40. > :03:43.Samsung's words, the Galaxy Note 7 being withdrawn completely from the
:03:44. > :03:47.market for the time being. Many see this as an opportunity for Apple but
:03:48. > :03:56.there are many other players in the market now, including Google's Pixel
:03:57. > :04:02.phone. In the competition is very hot. Absolutely, the timing is
:04:03. > :04:05.fantastic for Apple, an ideal moment to capture market share from its
:04:06. > :04:09.traditional rival but the market place is so much more competitive
:04:10. > :04:16.than it used to be. Google could make waves with its Pixel phone, and
:04:17. > :04:20.in China rants such as Huawei will make it much more challenging for
:04:21. > :04:25.Apple to grab the market share once have taken for granted. -- brands
:04:26. > :04:29.such as Huawei. No matter whether Apple is doing fantastically or not
:04:30. > :04:34.so fantastically it is still shifting huge numbers of units and I
:04:35. > :04:37.think investors always give it a tough time, perhaps forgetting just
:04:38. > :04:41.how much money this is still making and if it can up the money which is
:04:42. > :04:44.coming from services, especially those from revenue based models,
:04:45. > :04:49.there is a lot to be positive about here. And as well, things come in
:04:50. > :04:54.waves. One report I read yesterday said they will be a wave of volumes
:04:55. > :04:58.of people wanting to upgrade in a year or so, so the iPhone seven may
:04:59. > :05:03.miss that at the next phone that comes after that. You could argue
:05:04. > :05:07.that the iPhone seven is here to keep things ticking over, to meet
:05:08. > :05:12.demand from the next holiday season. It is the next wave of releases
:05:13. > :05:16.which people are excited about, an anniversary release where we can
:05:17. > :05:23.expect some serious consumer interest. Thank you for giving your
:05:24. > :05:27.analysis on Apple. It has had an impact in trade on Asia. Many
:05:28. > :05:29.suppliers were hit in the beginning of the day and have recovered, and
:05:30. > :05:30.Taiwan in particular. A federal judge in the United States
:05:31. > :05:33.has approved a $15 billion settlement with the German carmaker
:05:34. > :05:36.VW, to settle claims with customers and regulators in connection
:05:37. > :05:38.with its manipulation It is the biggest fine
:05:39. > :05:41.in US automotive history. Volkswagen will begin buying back
:05:42. > :05:44.475,000 diesel vehicles The German car giant admitted
:05:45. > :05:48.cheating emissions tests in the US last year, by fitting a defeat
:05:49. > :05:51.device in the vehicles. The vehicles affected emit
:05:52. > :05:54.up to 40 times legally Michelle Fleury in New York says
:05:55. > :06:20.there could be more bills The company, we understand, has set
:06:21. > :06:24.aside around or up to 20 billion. At the same time, given how many more
:06:25. > :06:30.issues are still out there, it is hard to see whether or not they will
:06:31. > :06:33.need to put more money aside. The Justice Department in the United
:06:34. > :06:37.States is still investigating. A settlement may be reached which will
:06:38. > :06:42.involve more money. The other sums it is paying to its dealers in
:06:43. > :06:46.America. There are lawsuits not just in America but in other parts of the
:06:47. > :06:48.world. So the bill is still mounting, the final tally has not
:06:49. > :06:49.yet come in. The world's two biggest aircraft
:06:50. > :06:51.makers, Airbus and Boeing, both have their third-quarter
:06:52. > :06:53.results out today. Both firms are having to deal
:06:54. > :06:56.with slumping sales. We should hear from Airbus
:06:57. > :06:58.within the next hour. In September, the firm indicated
:06:59. > :07:00.that it was embarking on a cost-cutting and
:07:01. > :07:02.restructuring plan. Attention is also being focussed
:07:03. > :07:05.on prospects for the troubled A380. Jasper Lawler is a market analyst
:07:06. > :07:25.at CMC Markets in London. Good morning. Let's start with
:07:26. > :07:28.Airbus. What are we expecting? Well, the general expectation is that
:07:29. > :07:33.sales are going to tip slightly higher. The worry is more on the
:07:34. > :07:39.profit side, because really when you look at these airlines, both Airbus
:07:40. > :07:44.and Boeing, they are coming off the end of a supercycle, if you like, of
:07:45. > :07:49.strong orders. They have a big backlog. The worry is that that
:07:50. > :07:52.backlog will diminish as demand and sales come down but in the meantime
:07:53. > :07:56.they have the more short-term problem of actually meeting the
:07:57. > :08:00.demand and hitting those targets. So in a number of divisions, the
:08:01. > :08:07.military aircraft, the A380, there is demand, and even the A350,
:08:08. > :08:11.another wide-body jet, they have been having some supply problems and
:08:12. > :08:16.that is expected to weigh on the margins as they have to pay out if
:08:17. > :08:20.they are late deliveries. And when it comes to Boeing, any good news
:08:21. > :08:25.for them? Their results are out for the market opens later today. Where
:08:26. > :08:30.Boeing have the edge on Airbus is that they haven't yet said that they
:08:31. > :08:35.are going to cut the 777 production. So those big jumbo planes, it seems
:08:36. > :08:39.like airlines are unable to fill them with passengers. Boeing are
:08:40. > :08:44.looking better on orders and a very small single passenger jets are
:08:45. > :08:50.actually ahead of schedule, Boeing, so they are looking good, meeting
:08:51. > :08:56.customer demand. Airbus, unfortunately, in their 737 series,
:08:57. > :09:02.they have fallen behind with those of supply issues. Thank you for
:09:03. > :09:04.getting up so early for us. The empty trading floor will fill up in
:09:05. > :09:06.the next hour, I am sure. General Motors has
:09:07. > :09:09.warned that it may cut car production further in Europe
:09:10. > :09:11.as a result of Britain's vote to leave the European Union,
:09:12. > :09:14.as uncertainty caused by the vote The Detroit-based carmaker vowed
:09:15. > :09:18.to take whatever action is necessary to offset the impact of the Brexit
:09:19. > :09:22.vote, which has already cost it $100 million in the past three months due
:09:23. > :09:26.to currency fluctuations. US construction and mining equipment
:09:27. > :09:29.maker Caterpillar has cut its 2016 profit target, for the
:09:30. > :09:31.third time this year. The firm says it has been hit
:09:32. > :09:35.by the downturn in commodity prices, which has translated
:09:36. > :09:37.to a decrease in mining activity. Caterpillar says it now expects
:09:38. > :09:58.sales to be about $39 billion this You are now up-to-date on the
:09:59. > :10:02.business stories. I will be back in a couple of minutes and we will talk
:10:03. > :10:05.through the papers then. See you soon.