Today: The important questions for Apple (AAPL) after announcing next product launch, luring Burberry CEO to run its retail operations. Also: Yahoo (YHOO) and Intel (INTC) kick off Silicon Valley's earnings season, Tesla gains after survey shows interest in plans for future.
The Lead: What's ahead for Apple after event invite, executive hire?
Apple made two big moves Tuesday, announcing its next product launch event and the addition of a new executive in charge of the company's retail stores. The moves answer two questions that have lingered since last October, when Apple last updated its iPad line and fired its retail head, but leaves others awaiting clarity.
-- What will Apple announce next week?: Very little has changed since the last time we checked in on this question last week, when the focus was on new iPads, including an iPad Mini with a Retina display that could be in short supply, as well as details on Apple's new Mac Pro and its OS X Mavericks operating system.
The only new clue to arrive Tuesday was the tag line on Apple's invite, "We still have a lot to cover," Apple typically does provide a hint of what is to come at an event in the design of the invitation: In last month's invitation to its iPhone event, the company included several differently colored bubbles and the tagline, "This should brighten everyone's day," hinting at the announcement of the multicolored iPhone 5C.
Speculation on Tuesday centered on the word "cover" -- Cantor Fitzgerald analyst Brian White reported Monday that Apple would be introducing a redesigned Smart Cover at the iPad launch event, and the invite seemed to lend credence to that report.
A new Smart Cover would "drive an upgrade cycle for this line of cases (also an upgrade cycle for non-Apple branded iPad cases), which we believe is an attractive margin product for Apple," White wrote.
"I think it means the covers are going to be redesigned," BGC Partners analyst Colin Gillis told USA Today, but he added that the move would just be another in a series of uninspiring "iterative releases" under CEO Tim Cook.
"This doesn't necessarily propel the stock to the heights it was once at," Gillis said.
-- How can Angela Ahrendts help?: Apple has been without a leader for its retail stores since letting go of John Browett less than a year into his tenure, but they finally named a replacement Tuesday in Ahrendts, the CEO of British retailer Burberry who is well-regarded in many circles.
"This is a huge coup for Apple," Forrester retail analyst Sucharita Mulpuru told Mashable. "She's one of the true A-listers in retail and is someone that actually brings power, influence and credibility to the role."
Ahrendts will take over responsibility for online sales as well as retail in a new executive position, senior vice president of retail and online stores, and becomes the highest ranking female at Apple at a time when Silicon Valley companies face scrutiny for failing to place women in positions of power.
More importantly for Apple's bottom line, Ahrendts has major experience in China, where she grew Burberry's business and helped the British luxury retailer become well-known online and in brick-and-mortar outlets.
"She knows how to do retail in China and what works there," Gartner analyst Carolina Milanesi told Bloomberg News.
-- Will investors care?: Apple's stock price has been mired lower than $500 for most of the year, closing higher than that level only eight times since the end of January despite the company's attempts to push cash back to shareholders.
Tuesday, Apple jumped higher than $500 after the Ahrendts announcement and before the iPad invitation was delivered, but Wall Street turned sour after Washington failed to get a default deal done in its most recent stalemate, and the stock closed at $498.68, a daily gain of 0.5 percent.
As has been the case for months, Investors seem to be waiting for Apple to introduce a new product that can have a greater effect on revenues than just selling more iPads and iPhones. Ahrendts' hiring could be a signal that Apple's next product is near: The company has been rumored to be developing a wristwatch device dubbed the iWatch, and Jessica Lessin points out that watches were a big part of Ahrendts' career at Burberry.
SV150 market report: Yahoo and Intel announce earnings, Tesla rises
Wall Street dipped to an overall decline after Monday's optimism about a deal on Capitol Hill devolved into much shouting and little action of consequence on Tuesday. Silicon Valley tech stocks outperformed the larger national stock indexes, but still declined ahead of the beginning of earnings season for the area's tech giants.
Yahoo and Intel were the first big-name valley tech companies to release their financial performances for the third quarter, and both companies met or outperformed Wall Street's expectations. Yahoo lived up to forecasts that factored in the Sunnyvale company's dwindling display advertising business, reporting profits of 28 cents a share on revenues of $1.08 billion. Yahoo's revenues declined very slightly from the same quarter in 2012, while profits declined greatly due to the sale of half its stake in Alibaba in the third quarter of last year. The company expects another Alibaba windfall soon: Yahoo announced that a new deal allows it to keep more of its stake in Alibaba when the Chinese e-commerce giant performs its upcoming initial public offering, giving it plenty of IPO proceeds as well as a large stake for the future. Yahoo's forecast for the current quarter was not as well-received, however, and after an initial bump in after-hours trading, Yahoo shares moved back toward its closing price of $33.38.
Intel beat Wall Street expectations by reporting profits of 58 cents a share on revenues of $13.5 billion, but the company's stock tumbled in late trading due to its forecast for this quarter. The Santa Clara chipmaker said in Tuesday's conference call that it will have to move production of its newest chipset, called Broadwell, from the current quarter to the first quarter of 2014, and gave a revenue forecast for the current quarter of $13.2 billion to $14.2 billion; analysts expect $14 billion, Bloomberg reported. After dropping 0.3 percent to $23.39 in regular trading Tuesday, Intel shares declined again in after-hours trading by about 2 percent as shares sold for less than $23.
In Tuesday's regular session, Tesla Motors (TSLA) did its part to help boost the SV150 index, gaining 2.4 percent to $183.94 after an analyst report boosted hopes for the company's future, lower-priced model. Wedbush Securities upgraded the Palo Alto electric car maker from "Neutral" to "Outperform" after performing a survey that found 1 in 5 people would consider driving an electric vehicle and that nearly the same percentage would pay a premium of $5,000 or more for the long-term fuel savings. Those results pushed the analysts to decide that the company's plan to launch a lower-priced Tesla in 2017 would mean a 50 percent gain in sales when the car does arrive, and they raised their price target to $240.
Companies that suffered Tuesday included VMware, which declined 3 percent to $77.91 while announcing the acquisition of Desktone; and eBay (EBAY), which fell 1.5 percent to $53.97 ahead of its own earnings report, scheduled for Wednesday afternoon.
The SV150 index of Silicon Valley's largest tech companies: Down 5.91, or 0.44 percent, to 1,344.95
The tech-heavy Nasdaq composite index: Down 21.26, or 0.56 percent, to 3,794.01
The blue chip Dow Jones industrial average: Down 133.25, or 0.87 percent, to 15,168.01
And the widely watched Standard & Poor's 500 index: Down 12.08, or 0.71 percent, to 1,698.06
Check in weekday afternoons for the 60-Second Business Break, a summary of news from Mercury News staff writers, The Associated Press, Bloomberg News and other wire services. Contact Jeremy C. Owens at 408-920-5876; follow him at Twitter.com/jowens510.