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Apple Reports Strongest Ever Quarterly Earnings: $13.1 Billion Profit on $57.6 Billion in Revenue in Q1 2014
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Then sell and buy them back tomorrow 10% lower? Watching a stock decline has nothing to do with the "long haul"......it's called losing money!
Well, Samsung obviously is much more diversified than Apple but the majority of their profits also comes from mobile division (primarily phones). So they are not that much different.
Apple is giving software away for free, only because free software is worth more to them (in form of additional hardware sales) than paid software. One way or another the profit isn't growing, only the number of shares is shrinking.
Sorry again, my mistake.
So did Apple not beat their guidance on iPhone? Or was it Wall Street getting over aggressive on iPhone estimates?
It depends on a lot of factors. Those close to (or in) retirement may like it. Besides who knows where AAPL will be in 5 years? 4% from GE sounds like a better deal any way you look at it.
True. But this probably just means that the 5C was a dud and people flocked to the 5S, which is somewhat more difficult to make. That's hardly a sign that iPhone is losing steam at the moment. It just means that all the analysts calling for Apple to make an even cheaper iPhone don't know what they are talking about. It's also a sign that the smartphone market is saturating. Apple can still grab some high-end market share with a larger device, so there is still some room for them to grow. That said, a new category altogether will be nice. We don't know yet when iPhone will follow the sales pattern of the iPod and start a decline, but it is probably sometime over the next 5 years.
Apple's relatively weak guidance is also spooking the Street.
Hey @Rogifan - if you were listening to the conference call the Apple CFO cited Kantar - so much for your "who are they anyway" post on another thread.
True, in that respect they aren't. But analysts put so much stock into the units shipped vs. the margins made on them, which is something I don't understand. Had Apple priced the 5C at $450 instead of $550, perhaps they'd have hit the 55 million or even 60 million, but that would have killed margins. Apple doesn't need to go down that death spiral. They can't out-Samsung Samsung, so it's better for them to just be Apple.
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That's tying up money for 5 years. 2% isn't a great long-term return, as inflation typically exceeds 2%.
You and I know what guidance means: nothing. Well, it means "disaster" if the company fails to meet that minimum target. The markets know this, and are positioned ahead of earnings to expect the Street numbers, at a bare minimum. I look at EPS primarily, with something like a 5% beat (not great, but certainly not awful), I don't expect a big move down.
Somehow 2% and nothing are the same to you.
It's NOTHING when you're talking about a $550 share price.
You can buy Canadian Bank Preferred Shares @ $25/per with a 4.5 - 5% annual return - lots of better return options than AAPL.
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That has nothing to do with what I said.
Yes, it is. Apple simply changed the way it was accounting for certain revenue. The simply deferred $900 million in actual hardware revenue earned this quarter to future quarters in order to account for future software updates. That does not mean that they didn't earn the additional revenue!
Yep. But it would have been of interest. Especially when reading recent rumors that the 5c won't continue as it is today.
Well, it was so obvious that they were going to make this money. When iPhone 5S has come out, finger print has been introduced as a breakthrough to unlock phone or making a purchasing on iTunes Store. Even though Apple has been upgrading camera 2 years long. Also, 64 bit processor made difference compare to competitors of Apple. Is there someone who said; Apple is doomed ?
Having $158b in undistributed/uninvested cash is NOT good work. Companies are valued based upon an eventual return of cash to shareholders (via regular dividends, special dividends, buybacks, or ultimate liquidation).
That's exactly why a miss on the iPhone number is such a big deal.
Expectations matter. If JP Morgan made $2m in a quarter vs. expectations of $5b you think all is forgiven because it's still a lot of money to a retail investor? Cash flows are discounted to arrive at a value. The size of those cash flows, even if they're both large, is obviously important.
Baldimac said:
If you don't think Wall St is capable of digesting a deferred revenue accounting change then I don't really know what to tell you.
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On the bright side, it makes the buyback cheaper, and if you still believe in the long-term prospects of the company, it's another buying opportunity. It does keep the heat on Cook, though.
I wonder if this kind of result is only going to keep pushing Apple to release all products at the same time of the year, in order to concentrate all profits in a single quarter and thus keep breaking records (as well as providing huge numbers). Could make for a very boring wait, despite the expected new product categories.