Apple’s earnings miss could take down the stock market

“Of all the earnings reports released this season, who’d have ever thought it would be Apple that could take down the stock market,” Lee Brodie reports for CNBC. “But after the bell, Apple released quarterly results that left pros with their jaws agape. ‘This is a real negative. The Street is shocked by this,’ said trader Tim Seymour, founder of EmergingMoney.com, on CNBC’s Fast Money. Apple missed earnings estimates, revenue estimates and iPhone sales estimates.”

Brodie reports, “For the quarter ended June 30, Apple reported a profit of $8.82 billion, or $9.32 a share. After revisions lower, analysts had most recently predicted a per-share profit of $10.37 a share. Also, Apple sold 26 million iPhone units — the Street was looking for 29 million. This makes problems for the stock market bulls,’ said Dennis Gartman, author of The Gartman Letter. ‘It makes problems for anyone that’s long.’ In part that’s because Apple is the largest company by market cap. And any decline in Apple stock tends to be amplified. But more important, results will also kill sentiment.”

“Apple’s results suggest that recent economic data is not to be ignored; that the global economy is getting a lot worse,” Brodie reports. “Money managers will say, ‘If Apple is not immune (to the malaise) then I’m out of the market. I don’t need to buy anything,’ added trader Tim Seymour.”

Read more in the full article here.

MacDailyNews Take: We follow Apple very closely and we are unmoved by Apple’s Q312 results. Mac units are +2% YOY, iPhone units are +28% YOY, and iPad units are +84% YOY. Apple, at least, and especially in this economy, is doing just fine.

This too shall pass.

Related article:
Apple misses estimates with $9.32 EPS on $35.0 billion revenue – July 24, 2012

63 Comments

      1. This is the same thing as saying. “World up in arms, collapse imminent. One horse race, winer looses on all six lanes, because they didn’t break the world record, and missed the spread.”

        WTH, stop this nonsense.

        Earning Estimate, Revenue Estimate, iPhone Sales, are all the same thing. Triple Jeopardy here.

        Just sayin’

        1. Hey danilko1,
          It is ‘loses’ not looses. Looses is not a word however loose means: free or released from fastening or attachment: a loose end. Lose and lost have only on letter ‘o’. That should help you decide which word to use.

          Loose for lose is a common misspelling or grammar error, it is the sound of ‘oo’ that confuses folks. However, look up looses you will be hard pressed to find it. You will be referred back to loose.

          Also, it is winner not winer.

          Cordially,

            1. On the internet from what I see every day, the misuse of loose in place of lose is more common than the correct usage in posts in every forum I visit.

    1. By now analists should learn to understand that their self-inflicted knee-jerk reactions (because of their own blown-out-of-proportion expectations) have the potential of causing wild fluctuations of the entire stock market. Hopefully the “system” is robust enough to withstand these (even as more nanosecond algorithms enter the picture). Maybe some of those algorithms, but foremost, some analist behavior should be outruled.

      1. These intentionally generated fluctuations themselves are harmful, because rather than benefiting productive companies that do the real work, it only enriches the analists and their leech friends, who just suck money out of the economy.

  1. WHAT earning miss? Apple provided guidance of $34 Billion Revenue and $8.68 Profit per share and delivered $35 Billion and $9.29 EPS… I repeat, WHAT MISS???? Some over enthusiastic wild ass guessers’ drugged up pipe dreams????

    Apple guidance was still blown away by reality… the actual EPS was 7% over guidance… a respectable overage. But because they did not blow away the exuberance, the STOCK MARKET IS GOING DOWN??? Give us a break!

    1. + ∞

      It is sheer madness that a single company can bring the entire economy to its knees based solely on what so-called analysts predict the company’s performance ought to be. Do they even consider what Apple’s best and brightest forecast back three months ago? No. Oppy knew three months ago that there would be a slowdown in Q3 due to an upcoming iPhone release in Q4, which is why he honestly gave conservative guidance.

      And why didn’t these same people leap to their deaths when MS announced its first quarter loss ever?

      Why wasn’t there a ticker tape parade when Google outdid the consensus?

      Why does the SEC even allow such market manipulation in the first place?

      Maybe Apple should buy back all outstanding shares and take the company private.

      This is total insanity and the insane are taking over the asylum.

      1. What manipulation? No one forced people to sell off their stock after hours! It’s simply a reaction to expected higher numbers. Really, that’s all it is. Follow the market and you’ll understand it. But don’t just follow AAPL. Follow other stocks too. Almost all stocks react to projected numbers at earnings time. Why on earth would you think it’s only Apple? It’s not some sinister plot. The whole world isn’t against Apple. You sound like someone who had his dog run over. Apple is just a company. If you need a friend get a dog. It’s just the market. Happens every day. Try to become an informed investor. Read, study, learn to invest. It’s not a conspiracy it’s just the way the market works. Rule number one, never fall in love with a stock.

        1. Bah. Of course it’s not a conspiracy. But follow Apple for the last ten years and it becomes blatantly obvious that the analysts are useless. They got Apple and it’s prospects wrong for nearly 10 straight years. But when they are wrong high, is “disappointing” “disastrous” and a whole host of adjectives designed to force the stock low, when the real take away is that the sustem puts far too much importance on the guesses of analysts.

    2. I’m glad you provided the Apple guidance numbers. I was a little shocked that Apple could have done poorly. I think Apple should survive.

      This kind of story has played in many previous quarters – Apple provides conservative guidance, pro analysts provide flawed overly inflated guidance, then Appele falls somewhere inbetween. The “street” frets. However, now thatApple has such a huge valuation, they attach larger concerns.

      Every company should have the problems Apple has.

      1. +1

        Financial anal-syt are mostly focused on gaming the system to derive maximum profit from gain or failure. They really don’t care about sound economic understanding or forecasting. Wall Street is one huge cesspool.

      1. + 10 so totally agree. These anal……yst are just either idiots or manipulators. Or both.

        Apple beat its own guidance. Its doing better than it projected. World should end.

  2. Not to mention another record quarter when sales of iPhones are hampered due to all of us knowing the 5 is coming. Many people didn’t upgrade to 4s either, opting to wait for the 5.

    Throw in iPad mini for the holiday season and I’m buying this dip and saying thank you for the dividend.

    People are fools for selling.

  3. Wall Street is full of HACK’s in my opinion. They do more harm than good for all the companies that are on the Stock Market. Apple made money this quarter and that is damn good in this global economy. Oh well, that’s life and just keep on putting out great products Apple. 🙂

  4. “MacDailyNews Take: We follow Apple very closely and we are unmoved by Apple’s Q312 results. Mac units are +2% YOY, iPhone units are +28% YOY, and iPad units are +84% YOY. Apple, at least, and especially in this economy, is doing just fine.
    This too shall pass.”

    Don’t be OBLIVIOUS to what is happening. The world is deleveraging and it will take years to unwind this DEBT in the world. Sell while you can. 2013 will be a disaster!

    1. I believe you are probably right about 2013. I talk to friends and family that say 2013 will be Hell on Earth for the Investor trying to find a place to make money. I’m glad I pulled out back in 2008 completely.

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