Apple’s ‘disappointing’ quarter the most profitable quarter for a tech company in history

“Even after a quarter widely panned on Wall Street as ‘flat’ or ‘disappointing,’ Apple holds the top spot among the most profitable U.S. companies by a significant margin,” Kevin Bostic reports for AppleInsider.

“The $13.1 billion in profit Apple posted for the first quarter of 2013 is the most profitable quarter for a tech company in history, just edging out the record $13.06 billion set in the first quarter of 2012 — also by Apple,” Bostic reports. “A comparison of Apple’s record quarter to those of the other most profitable companies in the United States shows Apple head and shoulders above its American peers.”

Bostic reports, “Apple’s $13.1 billion in profit is 31 percent more than the $10 billion of its closest competitor, oil giant ExxonMobil… Apple earned more than twice the $6.4 billion of its nearest competitor, Redmond software giant Microsoft. Add in the $5.8 billion earned by IBM, and Apple still beats the total by nearly a billion dollars. ”

Read more in the full article here.

MacDailyNews Take: Jim is a young, electric Olympic high jumper. Just before the Olympics, sportswriters expected him to jump 2.65 meters, which would obliterate the World Record (2.45m). At the Games, Jim jumped 2.60 meters, setting new Olympic and World Records. The bar had never be set higher, nor had it been cleared with such power.

“Disappointed” sportswriters blasted him for his “failure” meet their expectations. For weeks afterwards, Jim’s “failure” was discussed ad nauseam in newspapers, on sports radio and on TV. The “disappointment” became so rampant that Wheaties declined to offer Jim a contract. Obviously, “The Breakfast of Champions” could not be associated with such an abject “failure.”

In the meantime, with the World Championships looming, Jim’s so-called “competition” silently pissed themselves, resigned to “competing” for distant second place finishes for the remainder of their unremarkable careers.

[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]

Related articles:
Apple’s earnings expectations have no basis in reality – February 7, 2013
comScore: Apple #1 smartphone maker in U.S. with 36.3% market share – February 6, 2013
Apple dominates mobile phone makers with 72% profit share worldwide in Q412 – February 6, 2013
Canalys: Apple continues reign as #1 PC maker; grabbed over 20% share of market for first time in Q412 – February 6, 2013
Apple’s iPad dominates tablets with 81% Web usage share; Amazon Kindle Fire distant 2nd with 7.7% – February 6, 2013
Apple’s all-time record quarterly earnings disappoint – January 23, 2013
After posting new all-time record revenue, Apple shares collapse in after-hours trading – January 23, 2013
Apple reports record results: $54.5 billion revenue, $13.1 billion profit, $13.81 EPS – January 23, 2013

32 Comments

    1. It’s about the rate of future growth. The street has pegged Apple for an established company that will not grow fast.
      Apple put profitability over market share. The street can’t understand this.
      The street will pump up a stock when the sentiment is that the company is poised grow substantially in the future. That’s why they love Netflix and Amazon. Both are operating at zero profit and are trying to expand market share in nascent markets.

      1. Close, but not quite. Apple has put superior quality products and user experience above marketshare. With great product that work so well people want to buy them, the profits just naturally followed. Why is wallstreet and others so blind to this?

        1. Because WallStreet only understands stoggy slow moving companies like Walmart, Kmart, Sears, etc where the profits are the same, so its only market share that makes any sense.

          Also,P/E rations lose all sense applied to Apple. Because Apple thinks different, Wall Street just cannot understand it, so they punish it.

          Sad.

    1. You understand, this is true Communism…

      Apple has not met it’s “5 Year Plan” or in our case, quarterly Analyst figures. It doesn’t matter, that the plan was unreasonable, the actual tallies met were the highest ever achieved.

      The analysts were disgraced so they sacrificed the messenger.

      The irony is, in a totalitarian nation, where they tout communism, yet are not – typically they change the rules on the fly, and state the 5 year plan was met and exceeded. Apple would be a hero.

      It’s all utter BS. Vampire economics, and it has to stop!

      1. Golum,
        Understand that “true communism” has nothing to do with how the Soviet Union worked or works now. Lenin had a plan and an idea. The government just used the buzz words and ran a dictatorship. They just called it communism.

        Just a thought.
        en

        1. Speaking of the analogy and the erstwhile Soviet Union reminds me of the headline of an article that Pravda ran announcing the results of dual track meet at Stanford: “USSR comes in second at big international track meet” The subhead read, “USA placed second to last.” I leave it to readers to figure out the actual results.

  1. No, it’s all about stupidity and what the Anal-ists believe is the only thing that is right. Except they’re usually wrong 99% of the time. Apple is working on great products, not junk like Amazon, Netflix doesn’t even have products. Apple is going for high quality, high customer support. Consumers are smarter then you think. They like cheap sometimes but without service they will go elsewhere and pay little more with great service to backup the products they bought. Apple does both very well and once a customer see’s this, they see value in what they have bought far greater than cheap can get you. I wouldn’t bet the farm on Apple slumping in profits yet boys.

  2. Ah, yes. I knew the analysts reminded me of another meretricious group—it’s the sportswriters. All wanting to be the next Hemingway, all secretly envious of the finest athletes, none held back from their sniping by ethics, and lately, showing their teeth by hijacking the MLB hall of fame voting.

      1. Unforgivable. Is sports writing that far gone now with the Internet? Time was, the print media had copy editors. Are they all out of work now? The New York Times still has some, although fact checkers seem to have been axed, and—do they still run an ethics column?

        The real travesty is the replacement of headline writers skilled at conveying a story’s quintessence, often with subtle humour, with hacks using buzzword algorithms to maximize page hits. I don’t know, but I think MDN has somehow melded the two.

  3. This story only reinforces Apple as being a poor investment. When a company can earn so much profit and Wall Street is dissatisfied and shareholders aren’t happy, there’s something very wrong. It basically shows the entire ruination of our country’s economy. When companies that actually make money become nearly worthless and companies that don’t make money become extremely valuable, there has to be something very criminal happening on Wall Street.

    When the street can turn Netflix and Amazon into money-making powerhouses based on future earnings it’s like turning vapor into cash. Apple’s cash hoard is as much as both of those companies market cap combined and Wall Street is disappointed. If there isn’t something crooked going on then I’ve wasted most of my life trying to tell right from wrong. Almost nothing in the real world works the way Wall Street does and they seem to be defying the rules of common sense by a huge amount.

    1. +1

      I lost respect for the ethical standards of several big Wall Street firms when I was overseeing a revolving loan fund with assets of $0.25 billion. I came under pressure to leverage the fund by a big bond issue, although it was clear that the fund already had adequate resources to satisfy its mission for the foreseeable future. That proposed bond issue would have reduced the viability of the fund in the long term. Its only purpose would have been to churn fees and commissions for Wall Street firms. One of the firms that failed in 2008 tried to apply political pressure to force a bond issue. Another firm that went down in flames that year had made a leveraging proposal that was so risky that the fund would have been ruined had the proposal been implemented. I was able to protect the fund. It wasn’t easy.

      Bottom line: I believe in capitalism, but learned that some who call themselves capitalists more closely resemble crooks.

  4. Love MDN’s take. Except for the last paragraph. The last paragraph should read:

    In the meantime, with the World Championships looming, Jim’s so-called “competition” promoted themselves as better athletes. All signing on to multi-million dollar contracts with Wheaties, with the worst performing getting the biggest contracts.

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