Apple On A Tear - Up more than 50% in 3 months

Apple Inc. (NASDAQ: AAPL) shares have run up more than 50% during the last three months.

Apple is one of the Top 20 Innovators of The Innovation Index.

What is driving the stock price?

1. Apple had an impressive second quarter earnings that beat the Wall Street estimates handily. Apple is poised to continue the earnings momentum in 2008, and beyond. How big has Apple revenue grown over the previous five years? About 300%.

2. Mac business is solid as a rock, growing 50% year over year. Apple has just rolled out new versions of iMac clocking over 3 GHz. And Apple is gaining ground in the laptop segment with the MacBooks.

3. iPhone business is strong, and Apple is on track to sell 10 million or more iPhones in 2008 - we estimate over 12 million. Some estimates track iPhone sales of over 5 million already in 2008.

Apple is introducing the all new iPhone 2.0 aka iPhone 3G next month. Further, Apple has created alliances all over the world to sell millions more iPhones.

Four mobile operators in the Asia-Pacific region introduced partnerships with Apple to bring the iPhone to their regions later this year. SingTel in Singapore, Bharti Airtel Ltd. in India, Globe Telecom Inc. in the Philippines and Optus in Australia. SingTel owns Optus and holds a 30.5 percent stake in Bharti and 44.5 percent in Globe. SingTel has about 2.3 million mobile subscribers in Singapore and around 7 million in Australia, according to data as of Dec. 31, 2007. Bharti currently has about 64 million subscribers, while Globe reported a 21.3 million mobile subscriber base for the quarter ended March 31. Potential Available Subscriber base for the iPhone: Over 95 million.

The top mobile phone operator in Latin America, America Movil SAB, (NYSE: AMX), another Top 20 Innovator, also announced plans to deliver the iPhone to its region. America Movil has 159.2 million subscribers in 16 countries, including Argentina, Brazil, Chile, Colombia and Mexico.

Apple has also signed deals with Rogers Communications Inc. to sell the device in Canada; Milan-based Telecom Italia SpA to sell the iPhone in Italy; and Vodafone Group PLC, the world's biggest mobile company by sales, to sell it in a total of 10 countries, including Australia, India, Italy and Turkey.

Finally, Apple sells iPhone with AT&T Inc. (NYSE: T), another Top 20 Innovator, in the United States, O2 in Britain, T-Mobile in Germany and France Telecom's Orange wireless arm in France.

In short, Apple has available subscriber base in the hundreds of millions for the iPhone - now it's a matter of time before Apple launches the new 3G iPhone, and potentially expands the market for the iPhone to tens of millions a year beginning in 2009.

The Innovation Index Fund Manager, that invests in Apple, is up 10% in 2008. The Top 20 Innovators of The Innovation Index have rebounded well in the 2nd quarter of 2008 to cause The Innovation Index Fund Manager to have double-digit gain for the year.

Innovation Index Group believes that the U.S. economy will recover significantly in the 2nd half of 2008, and the Top Innovators of The Innovation Index will reward the patient, long-term investor.

Innovation Index Group has BUY recommendations on the Top 20 Innovators of The Innovation Index, and price target of $235 - $250 for Apple in Q4, 2008.

About Innovation Index Group:

Innovation Index Group, Inc. is a new investment management company focused on systematically identifying, tracking and investing in the most innovative publicly traded companies in North America – collectively called the Innovation Index. We have developed the Innovation Index Fund, LLC as our first vehicle to invest in the Innovation Index. Over the past six years, the Innovation Index would have generated a gross average annual return of 40% based on historical model.* The Innovation Index returned 66% in 2007, and the Innovation Index Fund Manager is up 10% in 2008.*

Innovation Index Group, Inc. and Innovation Index Fund LLC are registered California Corporations, and member of the Irvine Chamber of Commerce in Orange County. Further, Innovation Index Fund LLC is a private placement investment partnership organized under the California state regulations.

The Innovation Index Reports:

Invest in The Innovation Index - Innovation Index Fund tracks The Innovation Index
The Innovation Index closes 2007 at 66% - 2007 Annual Report on the Innovation Index
Top 50 Innovative Companies in the world - 2007 Report on Top 50 Innovative Companies
Annual Report - Chapter One - Total Innovation Activity - 2006 Annual Report One
Annual Report - Chapter Two - The Top Innovator - 2006 Annual Report Two
Annual Report - Chapter Three - The Innovation Insights - 2006 Annual Report Insights
Innovation and Stock Performance Correlation - The Innovation Index and Stock Performance

About The Innovation Index

The Innovation Index introduced in December 2006 is a weighted stock price index of the top 20 Innovators in North America.

The Innovation Index returned 66% in 2007 based on performance model, and would have returned 174% over the previous five years (2002-2006) based on historical model*. This assumes equal investment in each stock of The Innovation Index as of December 31, 2001. An average of $100 invested in The Innovation Index on December 31, 2001 returned $454 as of December 31, 2007. By comparison, $100 invested in S & P 500 returned 28% or $129, $100 invested in NASDAQ returned 34% or $136, and $100 invested in the Dow Jones Index returned 30% or $131 through December 31, 2007. The Innovation Index beats the S & P 500, NASDAQ and Dow Jones Index by more than seven times over the past six years.*

Alphabetical list of the Top 20 Innovators of The Innovation Index for 2008 and their stock ticker symbols:

3M Company - (NYSE: MMM)
Amazon.com, Inc. - (NASDAQ: AMZN)
America Movil - (NYSE: AMX)
Apple Inc. - (NASDAQ: AAPL)
AT&T Inc. - (NYSE: T)
Best Buy Co., Inc. - (NYSE: BBY)
Cisco Systems, Inc. - (NASDAQ: CSCO)
Costco Wholesale Corporation - (NASDAQ: COST)
eBay Inc. - (NASDAQ: EBAY)
General Electric Co. - (NYSE: GE)
Google Inc. - (NASDAQ: GOOG)
Hewlett-Packard Co. - (NYSE: HPQ)
Intel Corporation - (NASDAQ: INTC)
International Business Machines Corp. - (NYSE: IBM)
Merck & Co., Inc. - (NYSE: MRK)
McDonald's Corporation (NYSE: MCD)
Microsoft Corporation - (NASDAQ: MSFT)
NIKE, Inc. - (NYSE: NKE)
Research In Motion Limited - (NASDAQ: RIMM)
The Proctor & Gamble Company - (NYSE: PG)

The Innovation Index will analyze the positions and standings of the Top 20 Innovators at the end of each year. For 2008, there will be no further changes in The Innovation Index.

Disclaimer: The Innovation Index Group, Inc. invests in the stocks comprising The Innovation Index.
*Past Performance Does Not Guarantee Future Results

Amazon.com, Apple, AT&T, McDonald's, 3M and Microsoft - Innovators Earnings Report

Amazon.com Inc. (NASDAQ: AMZN), Apple Inc. (NASDAQ: AAPL), AT&T (NYSE: T), McDonald's (NYSE: MCD), 3M (NYSE: MMM) and Microsoft Corporation (NASDAQ: MSFT) delivered solid results, and either met or beat the first quarterly earnings. These are six of the Top 20 Innovators of The Innovation Index.

Amazon.com "Net sales increased 37% to $4.13 billion in the first quarter, compared with $3.02 billion in first quarter 2007. Operating income increased 36% to $198 million in the first quarter, compared with $145 million in first quarter 2007. Net income increased 30% to $143 million in the first quarter, or $0.34 per diluted share, compared with net income of $111 million, or $0.26 per diluted share, in first quarter 2007." - Solid results at Amazon. Amazon.com showed the street that it can grow the revenue and grow the income at the same time.

New innovations at Amazon.com:

-- Kindle selection continues to grow - with more than 115,000 titles now available, up from 90,000 at launch.

-- Amazon Web Services (AWS) launched Elastic IP addresses and the ability to provide compute instances in multiple zones; over 370,000 developers have registered to use AWS, up more than 35,000 from last quarter.

-- Newly launched TextBuyIt (www.textbuyit.com) service lets customers use text messages to find and buy products sold on Amazon.com.

Business highlights at Amazon.com:

-- The number of sellers using Fulfillment by Amazon increased by more than 50% compared with fourth quarter 2007.

-- Worldwide Media sales grew 28% to $2.54 billion in first quarter 2008, compared with $1.99 billion in first quarter 2007.

-- Worldwide Electronics & Other General Merchandise sales grew 56% to $1.48 billion in first quarter 2008.

Apple Inc. "announced financial results for its fiscal 2008 second quarter ended March 29, 2008. The Company posted revenue of $7.51 billion and net quarterly profit of $1.05 billion, or $1.16 per diluted share. Apple revenue increased by 43%, and net profit increased by 36%. These results compare to revenue of $5.26 billion and net quarterly profit of $770 million, or $.87 per diluted share, in the year-ago quarter. Gross margin was 32.9 percent, down from 35.1 percent in the year-ago quarter. International sales accounted for 44 percent of the quarter's revenue.

Apple shipped 2,289,000 Macintosh(R) computers during the quarter, representing 51 percent unit growth and 54 percent revenue growth over the year-ago quarter. The Company sold 10,644,000 iPods during the quarter, representing one percent unit growth and eight percent revenue growth over the year-ago quarter. Quarterly iPhone(TM) sales were 1,703,000" -
Great Earnings Report from Apple. Although Apple had provided a very conservative quarterly forecast in January, 2008, Apple beat the high end estimates on revenue, and came on the high end estimates on earnings. Apple once again gave a conservative outlook for the future. The street should get an idea now. Mac business is solid. iPod volume business is stalling, however Apple is selling higher priced iPods. iPhone business is strong, and Apple is on track to sell 10 million or higher iPhones in 2008.

AT&T's "revenues totaled $30.7 billion, up 6.1 percent versus reported results in the year-earlier quarter and up 4.6 percent compared with first-quarter 2007 pro forma revenues, which exclude merger-related accounting impacts on directory revenues. This marks a substantial step up from year-over-year pro forma revenue growth of 2.9 percent in the fourth quarter of 2007 and 1.7 percent in the first quarter of 2007.

AT&T's reported first-quarter 2008 net income totaled $3.5 billion, up 21.5 percent from $2.8 billion in the year-earlier first quarter, and reported earnings per diluted share totaled $0.57, up 26.7 percent from $0.45 in the first quarter of 2007."

AT&T delivered strong wireless growth in the first quarter, reflecting the company's high-quality network, innovative services, attractive handset selection, extensive sales reach and continued improvements in operations.

Of particular interest was "an accelerated Ramp in AT&T U-verse TV Services. Growth in AT&T U-verse TV service, the company's next-generation IP-based video service, continued its strong ramp during the first quarter, achieving a net subscriber gain of 148,000 to reach 379,000 in service. AT&T expects a further ramp in the quarters ahead and is on track to reach its target of more than 1 million subscribers by the end of 2008. Total video connections, which include AT&T U-verse service and bundled satellite television service, increased by 264,000 in the quarter to reach 2.6 million."

AT&T is using scale to an advantage, and also creating new innovations such as U-verse TV to attract new buyers and grow into new markets. AT&T had a good quarter, and provided a conservative outlook.

McDonald's reported the following first quarter highlights:

-- Global comparable sales increased 7.4%
-- Growth in consolidated Company-operated and franchised restaurant
margins for the ninth consecutive quarter
-- Consolidated operating income increased 24% (16% in constant
currencies)
-- Earnings per share were $0.81, up 31% versus $0.62 in 2007, and
included $0.05 per share of currency benefit

McDonald's surprised everyone with the strong global growth. For the quarter, Europe and Asia/Pacific, Middle East and Africa both delivered double-digit revenue and operating income growth. McDonald's is a growth business, and expect 2008 is poised to be an excellent year for the Big Mac.

3M announced first-quarter sales of $6.5 billion, an increase of 8.9 percent over last year. Net income was $988 million, or $1.38 per share, versus $1.4 billion, or $1.85 per share in the first quarter of 2007. Included in first quarter 2007 results are net gains of $422 million, or $0.57 per share, from the sale of the company's branded pharmaceuticals business in Europe, net of other various special items (a-c). Excluding the impact of these items, first quarter 2008 earnings per share increased 7.8 percent.

Key 3M highlights:

Industrial and Transportation
-- Sales increased 17.1 percent to $2.1 billion.

Health Care
-- Sales rose 12 percent to $1.1 billion.

Safety, Security and Protection Services
-- Sales of $859 million, up 13.4 percent.

3M gave a modest guidance for the rest of 2008, but "reiterated its 2008 earnings expectations. The company continues to expect full-year 2008 earnings to increase a minimum of 10 percent over 2007 earnings-per-share of $4.98, which excludes special items." 3M met the earnings estimates; however, the weak outlook drove down 3M shares during the week.

Finally, Microsoft announced third-quarter revenue, operating income and diluted earnings per share of $14.45 billion, $4.41 billion and $0.47, respectively. Microsoft surprised the street with mild earnings and mild outlook, whereas in January of 2008, Microsoft had given a strong guidance. Microsoft client division revenue that sells Windows Vista and Windows XP came in below the mid-range of the expectations, and the business division also stalled from last year. The street reacted by a corresponding decrease in share price. Although, if one looks under the hood, there are many positives in Microsoft's earnings.

Entertainment and Devices revenue for the quarter grew 68% over the comparable period last year driven by robust demand for Xbox 360 consoles. Cumulative console sales surpassed 19 million during the quarter, up 74% from a year ago. Server and Tools revenue growth of 18% added to its string of consecutive double-digit revenue growth quarters, which now stands at 23.

Would Microsoft turnaround and create a strong growth in the 2nd half of 2008? Would the proposed merger with Yahoo help Microsoft's business or distract it from executing?

Is Apple winning marketshare against Windows Vista? Apple had a strong surge in Mac business. Can Apple reclaim the position, slowly but surely, in the PC business? Apple has a really long way to go.... but if Apple can get to the 10% marketshare of the overall PC business worldwide, this would mark a significant milestone and signal a shift.

Innovation Index Group has BUY Recommendations for AAPL, AMZN, MCD, MMM, MSFT and AT&T.

About Innovation Index Group:

Innovation Index Group, Inc. is a new investment management company focused on systematically identifying, tracking and investing in the most innovative publicly traded companies in North America – collectively called the Innovation Index. We have developed the Innovation Index Fund, LLC as our first vehicle to invest in the Innovation Index. Over the past six years, the Innovation Index has generated a gross average annual return of 40%.

Innovation Index Group, Inc. and Innovation Index Fund LLC are registered California Corporations, and member of the Irvine Chamber of Commerce in Orange County. Further, Innovation Index Fund LLC is a private placement investment partnership organized under the California state regulations.

The Innovation Index Reports:

Invest in The Innovation Index - Innovation Index Fund tracks The Innovation Index
The Innovation Index closes 2007 at 66% - 2007 Annual Report on the Innovation Index
Top 50 Innovative Companies in the world - 2007 Report on Top 50 Innovative Companies
Annual Report - Chapter One - Total Innovation Activity - 2006 Annual Report One
Annual Report - Chapter Two - The Top Innovator - 2006 Annual Report Two
Annual Report - Chapter Three - The Innovation Insights - 2006 Annual Report Insights
Innovation and Stock Performance Correlation - The Innovation Index and Stock Performance

About The Innovation Index

The Innovation Index introduced in December 2006 is a weighted stock price index of the top 20 Innovators in North America.

The Innovation Index returned 66% in 2007 based on performance model, and would have returned 174% over the previous five years (2002-2006) based on historical model*. This assumes equal investment in each stock of The Innovation Index as of December 31, 2001. An average of $100 invested in The Innovation Index on December 31, 2001 returned $454 as of December 31, 2007. By comparison, $100 invested in S & P 500 returned 28% or $129, $100 invested in NASDAQ returned 34% or $136, and $100 invested in the Dow Jones Index returned 30% or $131 through December 31, 2007. The Innovation Index beats the S & P 500, NASDAQ and Dow Jones Index by more than seven times over the past six years.*

Alphabetical list of the Top 20 Innovators of The Innovation Index for 2008 and their stock ticker symbols:

3M Company - (NYSE: MMM)
Amazon.com, Inc. - (NASDAQ: AMZN)
America Movil - (NYSE: AMX)
Apple Inc. - (NASDAQ: AAPL)
AT&T Inc. - (NYSE: T)
Best Buy Co., Inc. - (NYSE: BBY)
Cisco Systems, Inc. - (NASDAQ: CSCO)
Costco Wholesale Corporation - (NASDAQ: COST)
eBay Inc. - (NASDAQ: EBAY)
General Electric Co. - (NYSE: GE)
Google Inc. - (NASDAQ: GOOG)
Hewlett-Packard Co. - (NYSE: HPQ)
Intel Corporation - (NASDAQ: INTC)
International Business Machines Corp. - (NYSE: IBM)
Merck & Co., Inc. - (NYSE: MRK)
McDonald's Corporation (NYSE: MCD)
Microsoft Corporation - (NASDAQ: MSFT)
NIKE, Inc. - (NYSE: NKE)
Research In Motion Limited - (NASDAQ: RIMM)
The Proctor & Gamble Company - (NYSE: PG)

The Innovation Index will analyze the positions and standings of the Top 20 Innovators at the end of each year. For 2008, there will be no further changes in The Innovation Index.

Disclaimer: The Innovation Index Group, Inc. invests in the stocks comprising The Innovation Index.
*Past Performance Does Not Guarantee Future Results

References:
Company Press Releases

Starbucks gets it right this time, partners with AT&T to provide Free Wi-Fi

AT&T Inc. (NYSE: T) and Starbucks (Nasdaq: SBUX) announced plans to deliver AT&T Wi-Fi(SM) service at more than 7,000 company-operated Starbucks locations across the United States. Starbucks and AT&T will offer a mix of free and paid Wi-Fi offerings at Starbucks stores to meet the needs of both frequent and occasional Starbucks Wi-Fi customers.

AT&T benefits because "the initiative further expands the AT&T Wi-Fi network to more than 17,000 U.S. hot spots and more than 70,000 globally" thereby entrenching AT&T as the leader in hot spots and making it the ever ubiquitous brand for Internet and mobility.

AT&T is one of the Top 20 Innovators of The Innovation Index. Starbucks was a Top 20 Innovator in 2007.

Starbucks benefits because millions of customers will now flock Starbucks for coffee and free Internet. Importantly, for the first time, a Starbucks Card holder gets an added benefit of two hours of free Wi-Fi service per day! According to the press release: "Beginning this spring, Starbucks Card holders can enjoy up to two hours of free Wi-Fi service per day at Starbucks locations offering Wi-Fi access, while more than 12 million qualifying AT&T broadband and AT&T U-verse(SM) Internet customers will have unlimited free access to the Wi-Fi service. In addition, more than 5 million of AT&T's remote access services business customers will be able to access Wi-Fi service at Starbucks locations."

Fringe revenue benefits: "In addition to the free Wi-Fi access for qualifying AT&T customers and any Starbucks Card holder, customers will be able to purchase tiered access to the AT&T Wi-Fi network at Starbucks at attractive price points. For a two-hour period, customers will pay just $3.99 per session. Monthly membership will also be available for $19.99 per month, and will include access to any of AT&T's 70,000 hot spots in 89 countries around the world."

Bottomline:

Rick Welday, AT&T chief marketing officer, Consumer emphasized: "Our work with Starbucks is collaborative innovation at its finest." Quite Possibly. What is Starbucks recipe for turnaround? Introduce $1 coffee, provide free coffee to loyal Starbucks customers who have a Starbucks card (coffee loyalty program), and offer free services such as the free Wi-fi to loyal customers. The new program will be a hit! As for AT&T, this is a huge marketing win, since it creates presence of AT&T in even more places and hot spots around the country and the world, provides AT&T customers nationwide Wi-Fi access and entrenches them further (not to mention increases customer loyalty), and has the potential upside of incremental revenue in the tens of millions.

Invest in the Innovation Index Fund

We launched the new Innovation Index Fund in December, 2007 that invests in the Innovation Index and returned 66% in 2007, and 174% in the previous five years. If you want to learn more about the Innovation Index Fund, fill out your contact information at the bottom of this form: http://www.innovationindexgroup.com/invest.html

The Innovation Index Reports:

Invest in The Innovation Index - Invest in the brand new Innovation Index Fund
Introducing The Innovation Index Fund - Invest into The Innovation Index
Top 50 Innovative Companies in the world - 2007 Report on Top 50 Companies
Annual Report - Chapter One - Total Innovation Activity - 2006 Annual Report One
Annual Report - Chapter Two - The Top Innovator - 2006 Annual Report Two
Annual Report - Chapter Three - The Innovation Insights - 2006 Annual Report Insights
Innovation and Stock Performance Correlation - The Innovation Index and Stock Performance
The Innovation Index gallops to 56% - Quarterly Report - Q3, 2007

About The Innovation Index

The Innovation Index introduced in December 2006 is a weighted stock price index of the top 20 Innovators in North America.

The Innovation Index returned 66% in 2007, and returned 174% over the previous five years (2002-2006). This assumes equal investment in each stock of The Innovation Index as of December 31, 2001. An average of $100 invested in The Innovation Index on December 31, 2001 returned $454 as of December 31, 2007. By comparison, $100 invested in S & P 500 returned 28% or $129, $100 invested in NASDAQ returned 34% or $136, and $100 invested in the Dow Jones Index returned 30% or $131 through December 31, 2007. The Innovation Index beats the S & P 500, NASDAQ and Dow Jones Index by more than seven times over the past six years.

Alphabetical list of the Top 20 Innovators of The Innovation Index for 2008 and their stock ticker symbols:

3M Company - (NYSE: MMM)
Amazon.com, Inc. - (NASDAQ: AMZN)
America Movil - (NYSE: AMX)
Apple Inc. - (NASDAQ: AAPL)
AT&T Inc. - (NYSE: T)
Best Buy Co., Inc. - (NYSE: BBY)
Cisco Systems, Inc. - (NASDAQ: CSCO)
Costco Wholesale Corporation - (NASDAQ: COST)
eBay Inc. - (NASDAQ: EBAY)
General Electric Co. - (NYSE: GE)
Google Inc. - (NASDAQ: GOOG)
Hewlett-Packard Co. - (NYSE: HPQ)
Intel Corporation - (NYSE: INTC)
International Business Machines Corp. - (NYSE: IBM)
Merck & Co., Inc. - (NYSE: MRK)
McDonald's Corporation (NYSE: MCD)
Microsoft Corporation - (NASDAQ: MSFT)
NIKE, Inc. - (NYSE: NKE)
Research In Motion Limited - (NASDAQ: RIMM)
The Proctor & Gamble Company - (NYSE: PG)

The Innovation Index will analyze the positions and standings of the Top 20 Innovators at the end of each year. For 2008, there will be no further changes in The Innovation Index.

Disclaimer: The Innovation Index Group, Inc. invests in the stocks comprising The Innovation Index.