“Apple reported earnings that beat analyst estimates on strong sales of iMacs, laptops and iPhones. But its cautious outlook led investors to slam the stock Wednesday morning, and take much of the Nasdaq down with it,” Jon Fortt blogs for Fortune. “Why?”

Fortt writes, “To some extent, it’s a case of one bad Apple spoiling the bunch. Steve Jobs & Co. is seen as the most innovative, growth-producing group in tech. And if the U.S. consumer’s economic troubles are starting to rattle mighty Apple, high fliers like Research In Motion and Google might not be immune, either.”

Fortt writes, “Indeed, Apple’s holiday performance showed signs that the company’s not unstoppable in 2008. In particular, Apple’s cautious outlook, weakness in U.S. iPod growth and the unpredictability of iPhone sales left Wall Street’s pessimists plenty of reason to doubt.”

MacDailyNews Take: Let’s take a look at that last sentence, shall we?
• Apple’s cautious outlook compared to Wall Street analysts who don’t seem to understand (or perhaps just don’t care) than Apple almost always issues a cautious, conservative outlook. Apple’s guidance expects 29.3% year-over-year revenue growth in Q2 08.
• Weakness in U.S. iPod growth due, at least in part, to the introduction of the iPhone (cannibalization: we bought iPhones last year, therefore didn’t need an iPod) and the fact that Apple’s iPod touch is a highly sought after, but most expensive iPod model (this year, we’ll buy Janie a Wii and Jimmy an iPod touch, instead of getting them both nanos). Even given that, Apple’s iPods unit sales grew 5%, set a new record, and iPod revenue surged by 17% YOY. The iPod mix is getting richer.
• Unpredictability of iPhone sales means that Apple has never sold iPhones in the upcoming quarter, so, quick, chickens, the sky is falling, sell, sell, sell!

Fortt continues, “[iPhone] cannibalization [of iPod] would be a bad thing. It would mean that iPhone growth doesn’t purely add to Apple’s results — it also takes away from the iPod.”

MacDailyNews Take: People should learn about how iPhone revenue differs from iPod before making foolish pronouncements. iPhone sales are the gift that keep on giving to users – and Apple. Apple doesn’t get paid by carriers for each iPod sold.

Fortt continues, “Apple’s outlook made Wall Street nervous. For this current quarter that will end in March, executives promised revenue of $6.8 billion and earnings of about $850 million. And while ordinarily analysts would take that number with a wink and expect Apple to easily beat it, this year they’re not so sure Apple can.”

Full article here.

MacDailyNews Take: So, when Apple does beat their own guidance will the analysts replace the tens of billions in lost AAPL shareholder value from the past month of fun and games?

Wall Street is a game. Play it well or sit on the sidelines watching in bewilderment trying to decipher who’s playing whom and by what, if any, rules.