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Print 33 comment(s) - last by inperfectdarkn.. on Oct 21 at 8:10 AM

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.

Sources: Apple, CNBC



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Problem with stock market
By Dug on 10/18/2011 10:39:50 PM , Rating: 5
Doesn't matter how much money you make, its all on expectations and not realistic.

If a private company made 3 bil profit year after year and every employee is well paid then life is good.

If a company on the stock market made 3 bil year after year they would be in trouble because they aren't constantly making more.




RE: Problem with stock market
By Shig on 10/19/2011 3:14:40 AM , Rating: 2
You are exactly right, 'expectations' have become an utter joke. I mean, you break a record and that's below 'expectations', what the fuck is that?!

Apple provides the world community with an innovative product, what the fuck does Wallstreet provide the world besides massive income inequality and impossible expectations?

Almost everything about the US system is so broken I almost don't even want to think about it, I'm 25 years old and I have very little hope for my country that I love so much :(


RE: Problem with stock market
By mcnabney on 10/19/2011 9:38:00 AM , Rating: 1
What's innovative about 4S?

Besides 'inventing' a number of Android features and stuffing the guts of the iPad2 inside?


RE: Problem with stock market
By seamonkey79 on 10/19/2011 10:49:09 AM , Rating: 2
They're the only ones that still put a physical button on the face of the phone? That's innovative!


RE: Problem with stock market
By Apone on 10/19/2011 12:35:28 PM , Rating: 3
@ Shig

- Income inequality? Broken system? Would you be saying this if you generously profited from investing? Bottom line, this is the essence of Capitalism and anyone who pushes themselves in learning the opportunities and understanding how to exploit and capitalize it can generate solid wealth. It sounds as if you're asking to be spoon-fed the financial success which I'm sorry to say, just ain't gonna' happen unless you hit the lottery.


RE: Problem with stock market
By nafhan on 10/19/2011 9:38:22 AM , Rating: 2
Even more frustrating (from my point of view, at least), is when a company makes a bunch of money on their products, but rather than show a huge profit for the year, they reinvest the money into R&D, etc. THEN Wall Street punishes them for not showing a huge profit.

I guess the moral of the story is that watching Wall Street is a good way to keep track of the stock market, but you've got to be careful trying to get anything else from those numbers.


RE: Problem with stock market
By Da W on 10/19/2011 11:30:41 AM , Rating: 2
Wall Street IS an irrationnal beast. Learn the concepts, do your homework and profit from it.

Apple had the tendency of doing conservative forecasts and then beating them. Over time people get used to that and expect more of the same. When one day the forecast are not beaten, speculators and day traders, that bet the house during the day that Apple would still beat its forecast, they become disapointed and sell off in a frenzy in after hours. Apple actually traded down on at least its 3 past quarterly earning results that i recall. THATS WHEN YOU BUY!

In the long term sound economics always have the upper hand over Wall Street irrational exuberance and CNBC'S fanboyism. Apple is a good company with record results and despite Job's death you can still expect growth from its iPad/iPhone/Mac and itune music/App store for a couple of years, then its still a good stock to buy at 400$ which is almost only 10 times forward earnings. On average stocks trade at 20 times earnings and in normal condition a growth stock like apple would trade up to 30 times earnings.
Oups, 408$, already went back up. See?


RE: Problem with stock market
By TSS on 10/19/2011 12:09:45 PM , Rating: 2
Blame skynet for taking over the world.

For once i'm not kidding. The name is High Frquency Trading though, rather then skynet. From wikipedia:
quote:
In high-frequency trading, programs analyze market data to capture trading opportunities that may open up for only a fraction of a second to several hours

quote:
By 2010 high-frequency trading accounted for over 70% of equity trades taking place in the US and was rapidly growing in popularity in Europe and Asia


So why did shares go down? Because the machines where programmed with the analysts expectations (since you can't program them with data from the future). You don't live up to them -> computer says no and sells. You could program the machines with lower expectations, and they'd buy....

But since the "market" is group behaviour and the status quo is "high expectations", everybody programs their machines that way because everybody else is doing it and theres no sense holding on to a falling stock, atleast for high frequency trading. It's really a logical conclusion, since the share holders want profit -> profit = more money so companies strive to gain more profit so analysts expect more profit thus the machines sell if that profit doesn't materialize.


By inperfectdarkness on 10/21/2011 8:10:17 AM , Rating: 2
this is why the USA is going down the tubes. record profits aren't sufficient for speculators.


"Paying an extra $500 for a computer in this environment -- same piece of hardware -- paying $500 more to get a logo on it? I think that's a more challenging proposition for the average person than it used to be." -- Steve Ballmer














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