Apple misses top line estimates, shares drop like a rock in after-hours trading

“Prior to Tuesday afternoon’s earnings announcement, most investors didn’t seem worried about Apple Computer’s fourth-quarter results,” Troy Wolverton reports for TheStreet.com. “Maybe they should have been.”

“While the company topped bottom-line expectations, its sales fell short of Wall Street’s estimates. More importantly, iPod sales were nowhere near the heady number bandied about on Wall Street. And following the company’s earnings announcement, its stock dropped like a rock,” Wolverton reports. “Excluding several tax benefit items, the company earned 38 cents a share, which narrowly beat Thomson First Call’s analyst consensus estimate of 37 cents a share. But at least on the revenue line, it wasn’t good enough for the Street.”

[Apple’s actual revenue: $3.69 billion vs. analysts’ consensus estimate: $3.73 billion]

“In the quarter, Apple shipped 6.45 million iPods. In contrast, analysts were expecting the company to ship in the neighborhood of 7 million units, and some whisper numbers were reaching as high as 9 million units,” Wolverton reports. “Although the Street might have been getting ahead of itself, Apple’s results were nothing to scoff at. iPod shipments might not have been as high as some were hoping, but they still rose 5% from the company’s third quarter and 220% year-over-year. Meanwhile, the company’s line of Macintosh computers posted strong sales as well, with unit shipments up 5% sequentially and 48% from the fourth quarter a year earlier.”

Full article here.
Apple shares currently stand at $46.06, down $5.53 from market close of $51.59 in extremely heavy after-hours trading volume of 9,798,006.

Related articles:
Apple shares plummet in after-hours trading – October 11, 2005
Apple Q4 05 earnings report: best quarter & best year in company history – October 11, 2005

45 Comments

  1. Just increased my position in AAPL at a 10% discount – thanks analysts for the (brief) selloff.

    I am lovin’ the increase in Apple’s Mac sales. So iPod sales were pretty much flat – what really happened with them? Color screens for the original, 6GB bumb for the mini (or was that the quarter before?) I mean, many people who wanted an iPod from the current line bought one already. There hasn’t been a huge reason.

    Better – from the confrence call I am listening to, Apple has sold 1 million iPod nanos in just 14 (or 17?) days – WHOA!

    MDN word: values (you can’t make this stuff up!)

  2. calm down mdn. there is always a sell off after earnings. or when such and such cumulonimbus moves .4 degrees east. or when that dog over there takes a crap and brushes the grass not with the left rear paw but with the left front paw. or when…..

    so what? it will be up again in a day or so. ” width=”19″ height=”19″ alt=”smile” style=”border:0;” />

  3. Approaching the top of the curve for the iPod. Apple better come up with something else. Like computers, for example.

    I’m soo done with milking the crap out of iPod. iPod this, iPod that.

    Apple’s not getting any closer to server rooms, and Macs aren’t getting any closer to enterprise desktop deployments.

  4. The after-hours sell-off feels like a Christmas fire sale.

    The question now if whether I want to buy even more after picking up 110 more shares in after hours at $45.77. Asking price is already now $46.29.

    And all the idiots who sold off are going to feel mighty stupid after tomorrow’s Special Event.

    But thank God for idiots! Otherwise, no one would be able to make money in the stock market! ” width=”19″ height=”19″ alt=”tongue laugh” style=”border:0;” />

  5. And then Apple makes their big announcement tomorrow and shares go up again…. investors are so fickle…

    As for the results, I think it’s funny that Apple increases iPod sales by more than 200 percent from last year, and investors get all bent out of shape because it wasn’t their fantasy come true of 9 million units.
    The introduction of Nano apparently reduced some numbers becaues they had a supply issue. So when you let the Mini sales die to prepare for the Nano introduction, that’s going to affect the number sold.

  6. Best Mac sales
    Best iPod Sales
    Increasing iTunes Music Store Sales
    Increased revenue from Retail Stores
    No debt
    Increasing cash on hand
    Net margins in line
    No excess inventory
    Huge year over year increase in profit

    And the Sheeple are selling!
    Amazing

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