Apple Announces Record Q4 Earnings, Investors Aren't Impressed
October 18, 2011 4:51 PM
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Apple shares fall in after hours trading
Apple today reported revenue of $28.27B for the fourth quarter and $6.62B in net profit ($7.05 per diluted share). These numbers compare quite favorably to $20.34B and $4.31B ($4.64 per diluted share) for the same quarter last year.
Gross margins for Apple during Q4 were 40.3 percent.
During the quarter, Apple sold 17.07 million iPhones (21 percent growth year-over-year), 11.12 million iPads (166 percent growth), 4.89 million Mac computers (26 percent growth), and 6.62 million iPods (27 percent decline).
“We are thrilled with the very strong finish of an outstanding fiscal 2011, growing annual revenue to $108 billion and growing earnings to $26 billion,” said Tim Cook, Apple’s CEO. “Customer response to iPhone 4S has been fantastic, we have strong momentum going into the holiday season, and we remain really enthusiastic about our product pipeline.”
Speaking of the iPhone 4S, Apple announced yesterday that it sold over
four million of the smartphones
during its first weekend of availability -- this was over twice the number for the iPhone 4's initial rollout in 2010.
Despite the good news coming out Cupertino today, investors weren't too terribly impressed. Analysts were expecting revenue of $29.69B and earnings per share of $7.39. They also expected quarterly iPhones sales to be in the
18 million to 20 million range
Apple shares are
down over $26 in after hours trading
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RE: seems high
10/18/2011 6:42:01 PM
From a pure technical trading standpoint the move makes sense.
You have to think that if there is a run in price in either direction in anticipation of news, that the market is already pricing the news in ahead of time. In the last two weeks there was a run from $370 to $420 in anticipation of earnings.
The market already priced the earnings into the stock ahead of time.
A dip after good news following a big run, even if it is positive, is very common in any stock. You know how people are bewildered by a stock dropping after good news or shooting up after "bad"? Same reasoning, the market has already priced the news in far ahead of time and it's already moved up a considerable amount. You have to look at the move prior to the event to get the whole story.
You can also see the same happen the opposite way. It has happened many times where AAPL or other stocks have dropped before earnings news, and then even when the news was to be expected it shot up afterwards.
Moves like this serve to take money away from amateur day-traders or extreme risk takers. Anyone else who has been holding for a long time or over the last month is fine. It's why trading on earnings or product announcements is as close as you can get to betting at the track. :)
"If they're going to pirate somebody, we want it to be us rather than somebody else." -- Microsoft Business Group President Jeff Raikes
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