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Apple Reports Best Quarterly Results Ever in Q1 2013: $13.1 Billion Profit on $54.5 Billion in Revenue [Call Ended]
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Looks like there should be good buy opportunities ahead this year, for those interested in value investing. Times of over-pessimism provide great prices. Just look at RIM and Nokia last year. This isn't even nearly as bad as Intel's guidance. The confidence of Apple's management shows that the company has reasonable financial stability.
AAPL's after market collapse makes no sense at all. What did people want to see? All financial indicators put Apple at a huge discount compared to the industry. The stock price reaction to the earnings report is purely insane.
Constrained supply. They couldn't get the iMac out fast enough and people stopped buying until they could get them.
Next quarter will show increased sales a demand for new iMac is met.
True, but even without looking it up, I am going to guess that INTC's multiples were much higher in 2000 than today. The earnings report was blah but not a disaster, so I am a little puzzled by the sharp drop -- though of course this is after-hours trading. The market has been pricing in lower earnings growth rates for months now. Pretty soon AAPL will be selling for PEs similar to companies that mine borax and manufacture pig iron.
The initial decline (~$20) was reaction to the earnings. The following $35 decline was due to the guidance.
Apple's figures are great, breaking yet another records and all, but I have some concerns of my own:
1. About 56% of the revenue came from iPhone sales. These figures are up from 53% last year. In addition, 20% of the revenue came from iPad, the same as last year. It means that three quarters of Apple's revenue comes from sales of iPhones and iPads. That's Apple's business.
The figures may be fantastic, but Apple relies too much in one product. Should the iPhone hype go away, or another revolutionary smartphone hit the market, Apple may collapse. That happened a million times with other companies, and Apple is not immune to that, as nobody is. There are threats everywhere, and Samsung is shortening the gap with Apple and is investing a lot in patents.
2. I am afraid of buying a Mac as my next computer, as I doubt Apple's commitment to it. Macs represented only 10% of Apple's revenue this quarter, down from 14% last year. Tim Cook may blame the iMac short supply, but that alone doesn't explain such a big drop. The fact is that Macs sales are indeed declining, together with the whole PC industry. If Mac sales continue to drop in the following years, Apple may well discontinue its line of computers in favor of iOS devices. Even if Apple does not discontinue the Mac, it may reduce the investiments in the development of both hardware and software in this area.
1. About 56% of the revenue came from iPhone sales. These figures are up from 53% last year. In addition, 20% of the revenue came from iPad, the same as last year. It means that three quarters of Apple's revenue comes from sales of iPhones and iPads. That's Apple's business.
The figures may be fantastic, but Apple relies too much in one product. Should the iPhone hype go away, or another revolutionary smartphone hit the market, Apple may collapse. That happened a million times with other companies, and Apple is not immune to that, as nobody is. There are threats everywhere, and Samsung is shortening the gap with Apple and is investing a lot in patents.
2. I am afraid of buying a Mac as my next computer, as I doubt Apple's commitment to it. Macs represented only 10% of Apple's revenue this quarter, down from 14% last year. Tim Cook may blame the iMac short supply, but that alone doesn't explain such a big drop. The fact is that Macs sales are indeed declining, together with the whole PC industry. If Mac sales continue to drop in the following years, Apple may well discontinue its line of computers in favor of iOS devices. Even if Apple does not discontinue the Mac, it may reduce the investiments in the development of both hardware and software in this area.
I haven't read every page, but I'm surprised by how many people are surprised that Apple's stock is falling. Regardless of how you feel about the products, without something new on the horizon and with growing competition, the price is going to fall.
Hmm, I also remember predictions that the iPhone and iPad would be duds. (Thank you Uncle Ballmer.)
Those who will never "get" Apple and will never see personal profit from AAPL investment are the ones that "find that one hard to imagine."
If history is our guide.
Given the drop in AAPL since the earnings call, it appears they will have a much lower average basis for this policy.conference call said:
I wonder if Braeburn Capital is also doing AAPL stock purchases? They don't have to disclose that.
I stated a year ago or so that there was a gap in AAPL at $445. The gap may or may not be filled, but at minimum, at $458 we sure came darn close! Watch tomorrow's intraday.
Rocketman, prognosticator
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It doesn't matter what Apple's guidance is, if they miss analyst guidance, they get beaten up for it, no one on Wall Street cares if they beat their own guidance or not.
Today we have 24 carriers on LTE around the world for iPHone 5. Those are in countries like the US, Korea, UK, Germany, Canada, Japan, Australia and a few others. Next week, we're adding 36 more carriers for LTE support in countries we're not currently supporting LTE -- Italy, Denmark, Switzerland, Philippines and several Middle Eastern countries, covering 300 million customers. iPhone 5 supports other ultrafast networks like HSPA+. Feel very good about the situation, particularly with these adds next week.
Could this be the 6.1 update coming next week?
Could this be the 6.1 update coming next week?
It still blow my mind that a company can report $13B profit for ONE quarter and the stock drops 10%. Has that ever happened before?
I would say most likely, though the number of companies that could report $13b in profits are few. It all depends on what the markets were expecting.
Like every company, they have some products that are more popular than others. Apple is not abandoning the Mac. It's still a massive business, even if the sales are declining.
Actually they beat the institutional guidance on EPS by 3%. Not a lot, but not a miss.
The company's financial statements is far to healthy to warrant a drop like this, either way great opportunity to buy at a discount and pickup that dividend in February. I still think a 10% drop is insane, and your breakdown is exactly correct.
Fact is consumers are voting with their wallet in favor of tablets and smartphones. I don't think Apple will give up on the Mac as there will always be a population that needs something more powerful than an iPad.
HobeSoundDarryl
macrumors G5
I didn't call it a dud. I said relative to the next big thing impact of iPhone and iPad on Apple's growth. Big difference.
I get expectations and all that but at what point do the numbers stand on their own? I think just about any company, including Exxon Mobile, would kill for those kind of numbers.
Right. I would have said if they don't significantly exceed analyst guidance, they get punished for it.