Motley Fool writer eats large helping of crow after seeing Apple’s earnings report

“This will come as no big shock to some of you. I’ve been pretty hard on Apple (Nasdaq: AAPL). As recently as yesterday, I suggested that the firm might not live up to its skyrocketing stock price. You can read the full argument here. Then you can ignore most of it. Apple smacked the ball out of the park with yesterday’s earnings release, and let me be the first to say that I was way wrong about a few things,” Seth Jayson writes for The Motley Fool. “Of course, when you talk smack, sometimes you get smacked back. Like now. Mmmmm… crow.”

Jayson writes, “Last night’s results may just dull my skepticism for good. Apple sold a ton of computers and about a zillion iPods. (Actually, only 4.6 million, but that’s almost a zillion.) If it continues to fly off the shelves, the music player will certainly eclipse CPUs as a revenue generator next quarter. Here’s better news. The long-hoped-for increase in computer sales finally materialized. The firm moved 26% more computers than last year. That’s a major improvement, and it’s vitally important. Those of you who read the 10K know that computers offer better margins. What’s not so expressly stated is that CPUs are a much better vehicle for creating long-term Mac zealots than iPods alone. Big increases on this line not only help the bottom line, they also ensure a steadier stream of future revenues.”

Jayson writes, “By far, the best bits are in the margins: The gross improved nearly two points, reversing the three-year downward trend I discussed yesterday, and setting the stage for a much more profitable earnings machine. SG&A dropped 3.5% as a portion of sales, helping net margins soar to 8.5%. That makes Apple more profitable than Dell (Nasdaq: DELL), for the time being. Absolutely amazing. Time for me to think different… For now, even this critic is a believer. If Apple can continue to do this voodoo, I might just have to pick up a few shares myself. If you bought this stock at $20, $40, or $60, congrats.”

Full article here.

MacDailyNews Take: Welcome to reality, Mr. Jayson.

Related MacDailyNews articles:
Motley Fool commentator: Apple has jumped the shark with new Mac mini – January 12, 2005

20 Comments

  1. Although very impressive, one quarter does not a company make. The reality that has yet to play out is what kind of supply contrainsts Apple will have on their new hot products. I hope the reality is that Apple continues on this path. But as Gates mentioned at the CES before the Expo, Apple has had three hits (implying they’ve squandered them in the grand scheme of things). One concern is the large drop in PowerBook sales. With the recent G5 PowerBook thermal design woes, this could be rather critical. Minor speed bumbs won’t hold everyone at bay for much longer.

    All-in-all, it will be interesting to watch!

  2. “one quarter does not a company make”

    One quarter, no.. try the last eight. This is no blip.. its the continuation of the last two years’ worth of only-great-news.

  3. he should also pat anyone that bought apple stock back when it was 10.00 or 13.00 on the back ” width=”19″ height=”19″ alt=”wink” style=”border:0;” />

  4. Tommo,

    As solid as Apple’s quarters have been the last two years, this quarter IS a blip (unless they continue it). Even Apple’s CFO threw a little cold water on the euphoria with his guidance.

    As I said earlier, I do hope they continue their growth in a sustained way.

    Brought to you by the word “distance.”

  5. Give credit to Mr. Jayson. He’s openly admitting that he made an error in his predictions. This is very rare in journalism these days.

    In fact, anyone remember the last time MDN has ever admitted to an error? ” width=”19″ height=”19″ alt=”grin” style=”border:0;” />

  6. I have to wonder how much of the increase in sales was down to the non-availability of an iMac product before the iMac G5 was launched. I don’t suppose it accounts for all of the increase but it must have accounted for some of it?

  7. I just emailed Mr. Jayson the following comment.

    “If you bought this stock at $20, $40, or $60, congrats.”

    I bought Apple’s stock for $16.00 not long after Steve Jobs returned as Apple’s CEO, at a time when most analysts were predicting the imminent death of the company. Maybe the term should be Motley Fools. ” width=”19″ height=”19″ alt=”grin” style=”border:0;” />

  8. I told everybody this stupid guy had not had a chance to check out Apple’s financial result before he started to criticize and boy was I right!!!! At least he has the courage to admit he was wrong and apologize. Where are the a$$holes like Turd-rot and Dork? Where are their apologies?

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