“Wall Street got ahead of itself with overheated expectations for sales of Apple Inc.’s iPhone, especially in light of the fact that a new model was highly anticipated,” Therese Poletti reports for MarketWatch.
“Apple said late Tuesday that it saw sales of older iPhone models reach a respectable 17.07 million units in the quarter, below the Street’s average estimates of about 20 million devices sold, as customers held off purchasing while waiting for the new iPhone in October,” Poletti reports. “The lower iPhone unit sales led to an unexpected quarterly earnings miss for Apple, coming in the same month that its co-founder Steve Jobs died at age 56. Its shares tumbled more than 5% in after-hours trading.”
Poletti reports, “Investors, however, should be heartened by the company’s forecast and what has been perceived as “barn-burning” sales of the new iPhone 4S. Apple’s outlook for the fiscal first quarter is for revenue to come in at $37 billion for the December quarter, slightly above the consensus of $36.1 billion, according to Thomson Reuters.”
Read more in the full article here.
MacDailyNews Take: Apple only banked $6.62 billion profit on revenue of $28.27 billion in the three months ended September 24, 2011 while many were waiting for the next-gen iPhone. Quick, somebody set up the bread lines for Apple employees. We have no idea how they’ll survive!
Related articles:
MacDailyNews presents live notes from Apple’s Q411 Conference Call – October 18, 2011
Apple posts record revenue of $28.27 billion, misses Street expectations for first time since 2004 – October 18, 2011
The world is going to end!!
Stupid effin people
Yet more BS to drive down the shares after hours, followed by them ramping back up 30-45 mins after the NASDAQ opens.
Sheesh, it’s getting so old!
They didn’t miss they exceded their guidance..
The whole game of over and under estimating without a whit of common Apple cycle sense is like watching children at play. Or like the Captain in the Simpsons admitting “Argh, we don’t know what we’s doin'”. One thing for sure, the Apple surely rises and ripens again (and again, etc.).
It’s a strange sort of reality when a P/E in the mid teens with 40% y-o-y growth qualifies as “overheated expectations.”
And a 40% profit margin!
Well, $6.62B is a whole lot less than what most people were expecting. I thought $9B was a distinct possibility.
Who was expecting that?
I’m not an analyst (thank god) but here’s how I see it: According to the theory that apple failed to meet “expectations”, apple’s stock price prior to the announcement implicitly took into account this expected profit. They didn’t meet it, falling short by 9B-6.62B = 2.38B. Apple has 927.09M outstanding shares, 2.38B divided by 927.09M = $2.56 per diluted share, meaning that they should’ve fallen by this amount as a “correction”. Why did apple instead fall by $26.28/share? Their revenue increased, their profit increased, they still have 0 debt, they have a massive pile of cash, and huge growth potential. So wtf?
Aapl is on sale. I’m going to buy some more tomorrow. Nuts to wall street.
In theory, a share of stock represents the present value of expected future earnings — not its performance in a single quarter or year.
Thus, the flaw in your logic is in assuming that the decline in profit is a one-time event rather than a permanent decrease in the company’s ability to earn profits quarter after quarter. Those who sold the stock so aggressively believe that Apple’s ability to grow profits in future years has been permanently impaired.
That notwithstanding, I do think the company’s problems were a one-time event resulting from the later-than-intended introduction of the new iPhone 4S.
And I was expecting $30B! So WHAT? What makes YOUR estimation (or anyone else’s for that matter) more worthy or accurate than mine?
This “disappointment” because of anal-yst’s projected expectations is ridiculous and almost criminal in my opinion. But that’s worth spit too.
In the article they implied the recession was catching up with Apple.
Didn’t they post a 40% gain year over?
Can anyone name me a company as large as Apple who showed a 40% YOY gain!
Wow. $28 BILLION revenue in a QUARTER. That’s mind-blowing.
When I went to my first WWDC, Sculley was proud to announce that Apple was on track to sell $2 billion in the YEAR.
The fact they managed to sell 17M iphones when everyone and their dog knew a new one was around the corner is amazing.
Yet if Apple had launched the iPhone 4S two weeks earlier and added 4 million more to the sales the street would be happy. All they’ve done is moved sales to the next quarter which will be a blow out. At the end of the year it’ll make no difference (yes I know Apple calls this Q4 results).
All Apple has done is make the “analysts” look stupid. Apple guided $5.50 EPS due to a major product transition and still beat that by a healthy margin.
iPad up 166%
Mac up 26%
iPhone up 21% (without launch of new phone)
4M iPhone 4S sold already.
Wall Street analysist are a bunch of idiots that don’t know want they don’t know. If they truly knew anything about business they would be running their own business.
“Apple’s sales rose 39% to $28.3 billion. The company’s sales for its full fiscal year, which ended Sept. 24, were $108.2 billion — a giant leap ahead of the $65.2 billion Apple raked in last year. Apple again edged out Exxon Mobil to be the stock market’s most valuable company in the world.”
“Apple sold more than 17 million iPhones. The iPad and Mac both set sales records during the quarter. IPad sales rose to 11.1 million, and Mac sales soared 4.89 million — the first time Apple has even sold more than 4 million Macs in a quarter.”
That’s some AMAZING news, yet Wall Street Analysts are setting the stage for how this plays out. Wall Street Analysts EXPECTATIONS (& possible manipulations) are what’s driving the price of the stock and NOT REALITY. What does that tell you?? #OWS
This is the thing, it doesn’t matter. Sure, they didn’t beat the street, so what. The iPhone 4S is an insanely good phone, Siri is getting stellar reviews, iOS 5, Lion, and iCloud are out and about, and you can only expect good thing this coming quarter. Just look a the numbers of Mac sold! The fundamentals are there, the sock will go up. If anything, this is a good buy opportunity.
I remember being amazed when Microsoft was banking $1 billion a month at a time when Apple barely seemed to have that much in revenue. Now Apple is banking more than $2 billion per month!
Oh, is this the same Wall Street that tok the country to the brink of bankrupcy, have never ever built a single product in their life and continue to think is relevant?
Screw Wall Street and their expectations. If they don’t like the price, they can drop dead, for all that I’m concern. They bring nothing to the table. They create no value, they create no jobs.
And good for Apple to stay the course despite of what Wall Street say. Look at HP now. They listened to Wall Street, they fired all of their thinking people (engineers and product designers) to keep the stock up (I know it first hand) and now they are nothing, they are reduced to a pimple in the tech industry, absolutely irrelevant.
I don’t care about the stock as much as I care about the products and the quality.
Real Artists Ship. ‘Nuff Said!
Preach it. Cannot stand those lying, cheating, elite, sewerscummy bastards.
Who the eff are they. Just leeches that rob and loot poor people everyday. Don’t give a rats ass what they think.
… sorry about the typos, I did not proof read the previous post.
There’s not really much a company can do about street numbers, save maybe media leaks to manage expectations. The street has always been off for years regarding AAPL, but they were off in the other directions. That many quarters of guessing low, plus the ridiculous expectations of an iPhone 5, probably led the street to shoot for the stars.
——RM
If Wall Street thinks this is bad…..then they need to swallow A reality pill. With statements like they didn’t meet Wall Street exceptions…….ready!!!! I can see why people hate everything about Wall Street.
I understand the problems with the system that is based on analyst projections, but it is what it is. I didn’t see much complaining when Apple blew out expectations for several years – in fact everyone was gloating about how analysts are so stupid to keep underestimating Apple. Now Apple comes below expectations (and let’s face reality, we were all expecting another easy beat and I didn’t see a single comment predicting otherwise) and suddenly the analysts are at fault for overestimating them? The mentality of most of you fanboys is laughable.
The only guidance Apple beat was their own, which is always sandbagged and doesn’t reflect what they truly predict (if it is, then Mr.Oppenheimer is even worse than the analysts based on accuracy). Both professional analysts and the amateurs who are highly regarded average much higher predictions than what Apple delivered. Sorry, but that IS a disappointment.
I don’t even see what the fuss is about – shares just became cheaper and Apple will remain strong for the foreseeable future.
Stop your whining, fanboys
Your an idiot ,nough said
I won’t point out the irony of “you’re” post
Oppenheimer only plays Wall Street’s game. If Apple had its way, it probably wouldn’t give any predictions at all. But companies that resort to no guidance are viewed as in serious trouble, so Apple gives very conservative guidance and routinely beats it.
The problem this Q was that Wall Street made its predictions, then realized that it’s always low, so it raised them even more. However, it failed to take into consideration the fact that Apple didn’t launch a new iPhone during that Q. Quite the mistake.
Now Wall Street has to make it look like Apple’s fault; like Apple screwed up; just to cover up Wall Street’s own blunders. Apple knew a new iPhone wouldn’t be launched in the Q, so it gave conservative guidance. Wall Street just isn’t capable of listening.
You havent’ got a clue what you’re talking about. Your ad hominem attack is a waste of space on the internet.
I’ve read it twice and it makes absolutely no sense any way you look at it.
Exactly what parts don’t make sense? Sometimes I feel like I’m the only person who uses and enjoys Apple products and also has a functional brain capable of critical thought.
I am loving all these posts. Advice to Apple: earn a few more billion and BUY Wall Street, then turn it into a pasture. The place is already full of horse shit.
None of this crap matters unless you are a day trader or have short term positions in AAPL. If you are a true investor, and are in it for the long haul, what happened after hours, and what happens tomorrow isn’t going to even be remembered in a month or a year from now.
This is just a bunch of nonsense for the talking heads to blather on about for the next 24 hours.