Investor Rights Law Firm Investigates Apple's Earnings Cut for 'Potential Securities Fraud'

[scottishwildcat]

I think the case is a loser. Ming Chi-Kuo reported that iPhone sales were down. Apple is finally confirming it isn't making the money hand over fist.

Er, Apple is still is raking it in faster than most companies can dream of. The App Store just hit a new single-day revenue record of $322m on New Year's Day, for example.

 

[apolloa]

I don’t think it is that clear that the case is merit less.

Cook in November:
“our business in China was very strong [Q4]. We grew 16 percent, which we're very happy with. iPhone in particular was very strong, very strong double-digit growth there”

Cook now:
“While we anticipated some challenges in key emerging markets, we did not foresee the magnitude of the economic deceleration, particularly in Greater China ... China’s economy began to slow in the second half of 2018 (includes Apple’s Q4). The government-reported GDP growth during the September quarter was the second lowest in the last 25 years.”

I guess the argument is that Apple knew, or ought to have known, of China’s economic conditions by the November statement, and that making such a positive statement was misleading given that Apple knew of the economy slowing down.

Yeap, agree with this hence the investigation. You can’t say one thing then a month or 2 later claim the opposite for the same time scale. Will be interesting what happens with this one as Cook is liable as he said it all..

 

[i-John]

"Furthermore, Bernstein Liebhard LLP is reportedly providing Apple a crystal ball for future, more accurate predictions".
[doublepost=1546515278][/doublepost]

A losing bandwagon, that is.

Guidance is not a guaranteed result by any means, and the firm correctly warned investors about the revenue miss well before earnings, also confirming an all-time record EPS for the quarter.

Not if they can find evidence that they knew numbers couldn't be met and said it anyway.

 

[jerwin]

FWIW, here's the transcript of the 4th quarter earnings call.

https://www.fool.com/earnings/call-...aapl-q4-2018-earnings-conference-call-tr.aspx

Wamsi Mohan -- Bank of America Merrill Lynch -- Analyst

Yes. Thank you. Tim there has been some real deceleration in some of these emerging markets, partly driven by some concerns around some of the rules, administration is contemplating and partly driven by things that are more specific to China, for instance, like some of the regulations around gaming. So can you talk about how you see the trajectory there for the business and what you think of the initiatives of some companies like Netflix and Fortnite trying to bypass the App Store around subscriptions and I have a follow up.

Tim Cook -- Chief Executive Officer

Sure. Great question. Starting with emerging markets. The emerging markets that we are seeing pressure in our markets like Turkey, India, Brazil, Russia. These are markets where currencies have weekend over the recent period, in some cases that resulted in us raising prices and those markets are not growing the way we would like to see. To give you a perspective at some detail, our business at India in Q4 was flat. Obviously, we would like to see that'd be a huge growth. Brazil was down somewhat compared to the previous year, and so I think at least the way that I see this is each one of the emerging markets has a bit of a different story. And I don't see it as an some sort of issue that is common between those for the most part. In relation to China specifically, I would not put China in that category. Our business in China was very strong last quarter. We grew 16%, which we're very happy with. iPhone in particular was very strong. Very strong double-digit growth there. Our other products category was also stronger, in fact a bit stronger than even the company, overall company number....

 

[Duane Martin]

Not a problem for Samsung.

https://www.cnbc.com/2019/01/03/app...ly-wouldnt-get-hurt-by-slowdown-in-china.html

Lol, not a problem for Samsung because Samsung phones represents less than 1% of the Chinese phone market according to the quoted article, which is the point they are making. However, Samsung does make components for other phones that do have a larger share in China (Apple, for instance) so I think the analysis that Samsung won't get hurt is optimistic. Not get hurt as much, perhaps.