The Street’s Wolverton’s laugher: ‘Apple delivers mixed bag’

“Apple Computer’s third-quarter report was sweet and sour for investors. The company blew through analysts earnings expectations and its own forecasts. But it offered a somewhat disappointing outlook for its fiscal fourth quarter,” Troy Wolverton writes for TheStreet.com.

“Apple projected it would earn 32 cents a share in the current quarter on $3.5 billion in sales,” Wolverton writes. “That’s slightly lower than Wall Street’s estimates. Sell-siders had previously predicted that Apple will earn 33 cents a share on $3.58 billion in sales in its fourth quarter… the report had some potentially troubling signs. For at least the second quarter in a row, the average sales price of Apple’s iPod fell in the third quarter. Apple saw about $179 for each of the digital music players it sold in the quarter, down from about $191 in the second quarter and nearly $290 in the year-ago period.”

Full article here.

MacDailyNews Take: Apple delivers the highest revenue and earnings in the company’s history and Wolverton sees it as “a mixed bag.” Does this guy want into the Enderle, Dvorak, and Thurrott weekly bridge game or what? Yes, this is the same Troy Wolverton who wrote last week that iPod demand “has slowed in recent months” because SigmaTel, which makes flash-memory for low-end music players, cut its second quarter revenue estimates and Creative Technology cut its own revenue outlook due to a shortfall on weaker-than-expected demand. For the record, Apple sold 6.155 million iPods; the highest Wall Street analyst had pegged iPod shipments at 5.5 million. Now, Wolverton wants to make Apple’s prudent Q4 2005 forecast ($3.5 billion) an issue, but he neglects to mention that Apple’s revenue forecast is a 50% increase year-over-year, the bulk of Tiger revenue has already been reaped, and the projection is based on a conservative outlook as Apple undertakes the transition to Intel-based Macs.

Related MacDailyNews articles:
The Street: the time may be ripe for Apple to get back to the Mac – July 13, 2005
TheStreet.com dubiously concludes that iPod demand has slowed, could impact Apple earnings – July 06, 2005

Apple shares surge in after hours trading on stellar earnings report – July 13, 2005
MacDailyNews’ live coverage of Apple Q3 2005 earnings conference call – July 13, 2005
Apple smashes street with record revenue, earnings; shipped 6.155 million iPods – July 13, 2005
Apple Q3 2005 Macintosh and iPod unit results – July 13, 2005

44 Comments

  1. What is that phrase– even a broken clock is right twice a day.

    I predict something more positive. Apple, because it has factored in a potential drop in Mac sales this first quarter after the chip switch announcement, will introduce more insanely great products for us to consume. I predict: iPod socks odor eaters, a tv top media box, or an Apple-branded line of massage oils. It’s gotta’ be one of these.

    Really. I mean it. Hey…where are you going?

    MDN word: “point” as in there is no point to my ramblings.

  2. “are all analysts this pessimistic about everything? Or does Apple just attract them”

    Apple attracts them. Most of these analysts are ignorant when it comes to Apple.

  3. You just have to understand that analysts are just like weather forcasters. It doesn’t matter how mwny times they are wrong, they don’t get fired and ther is absolutly no consequences on any statement thay make. People just go back for more until eventually, you just realise that if you want to know if the sun is shining, you just have to stick your head out the door and see what’s going on.

    But, since there always will be large portion of the population that will refuse to think for themselves, there will always be pundits willing to step into that role for them. “More pablum please…”

  4. The problem with these analysts (strongly resisting the urge to make anal comment here!) is that they often seem to believe their own hyperbole and appear delusional in their thoughts: they say it, therefore it must be true, and then when enough ignorant fools that can’t think for themselves follow, it becomes true.. The proverbial tail wagging the dog…

    MW: forces: Use the Force, Steve!

  5. The usual, the glass is half empty look at things. Can’t see how much Apple has gained but only what he thinks might be the dark side in the future which no one can predict anyways! ” width=”19″ height=”19″ alt=”mad” style=”border:0;” />

  6. And recall:

    Tiger actually made it out “earlier” than expected. Jobs had initially pegged its release for “by the end of the first half of this year.” The Apple developers were over two months early. A later release date for Tiger would have bumped some of that revenue to Q3. Perhaps Apple’s earlier estimates for the year anticipated such a time line.

  7. what an idiot……he believes decreasing unit cost is a troubling sign ? Is he so ignorant that he doesn’t understand that technology component costs tend to decrease over time ? This guy obviously has a bias here….too bad, i thought The Street.com was better than this.

  8. The guy has a problem with how much Apple is making per iPod and says it’s a troubling sign that it’s lower than a year ago.

    Yeah, that’s true, it’s lower. But Apple also sold how many more iPods than a year ago? They are more than making up for lower profit as the things become more competitive in price because they’re selling so many.

    I don’t know if this is a troubling sign or not. Apple couldn’t keep their profits high on the iPods forever. At some point, Apple will introduce a new iPod – or another device entirely – and the process begins again. High profit as early adopters pick it up, etc….

  9. analysts are like movie or book critics: they can’t run a company, make a movie, or write a book; yet, they feel qualified to criticise those who do. they’re just a bunch of wankers; pay no attention!

  10. “it offered a somewhat disappointing outlook for its fiscal fourth quarter”

    Wha? Almost word for word this is the same complaint analysts had about last quarter’s forecast!

    Don’t these guys learn? Apple are conservative in estimating their next quarter.

    (Does someone have Apple’s estimates from last quarter and the associated pooh-poohing by analysts? And probably every quarter previous)

    We all know never believe Apple. How many times did we get told that PPC were better than Pentium? Didn’t Steve at one stage say that flash-based MP3 players were pointless? We could make a great list of things Apple said they wouldn’t do, and then did.

    And quartley estimates are one of those little white lies. Gets the analysts everytime. Stock prices fall, smart investors call Apple’s bluff and live happily ever after.

    Dumb analysts meanwhile continue to look like…well… dumb analysts

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