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  (Source: Reuters)
Apple still logs record profit, but sees shareholder confidence shaken by miss

The good news Apple, Inc. (AAPL) fans is that Apple is forecast to be the most profitable American company for 2012 [source].

The company's calendar Q2 2012 (fiscal Q3) results, just reported, revealed a 20 percent spike in profits on a year-to-year basis, soaring to $8.8B USD on a revenue of $35B USD, a profit of about $9.32 USD/diluted share.

The bad news is that Apple's iPhone sales slumped, moving only 26 million units versus an analyst consensus of 28.4 million units.  Analysts had already scaled back their expectations earlier in the month from 30.5 million units.

Apple's arch-rival, Android phonemaker Samsung Electronics Comp., Ltd. (KSC:005930) is believed to have sold around 50 million smartphones for the quarter.  In other words, it is out-selling Apple -- by itself -- approximately 2-to-1 in unit sales.  In fact, Samsung's flagship Galaxy S III smartphone reportedly alone moved 19 million units.  That means that Samsung's sales of just its top model are already approaching Apple's total sales.

Analysts had expected $2.2B USD more in profit (revenue of $37.2B USD).

iPhone 4S
Samsung left Apple's iPhone in the dust in Q2. [Image Source: The Tech Journal]

The remaining good news for Apple is that it moved 17 million iPads, versus the analyst expectation of 15.4 million.

Mac sales fell slightly short of the expectation -- 4 million units versus the consensus of 4.3 million.  iPods -- largely marketed today as "kiddie iPhones" -- settled in at 6.8 million units, just above the 6.6 million unit consensus.

The good news regarding iPods and iPads was not enough to convince investors to overlook the profits and iPhone sales miss.  Stock was down $27 USD in after-hours trading and is expected to open lower tomorrow.

The sixth generation iPhone is expected to follow a pretty straight-forward formula -- larger HD screen, LTE, and faster processor.  The iPhone's current screen, processor, and modem are quite dated compared to those found in the Galaxy S III International Edition [source].  The iPhone does manage a draw on battery life, though, besting its Android rival in web-browsing life, but getting beat in talk time [source].

But the phone was a no-show in June, indicating Apple likely would continue to release handsets in October, following the slipped iPhone 4S launch.  Some analysts had hoped Apple would "catch up" with an accelerated sixth generation launch, returning to June product announcements and late June/early July product launches.

There's background noise to the investor fear as well -- some worry that the death of iconic CEO and visionary Steven P. Jobs may make Apple unable to stay ahead of the curve.  Indeed, Apple remains untested, in a sense, in that it has not released a major new product line since the death of Mr. Jobs.

Apple is relatively desperate to try to stop Samsung in court, seemingly unable to stop Samsung on the market.  It has seen some success scoring sales bans on the Samsung Nexus smartphone and Samsung Galaxy Tab 10.1 tablet.  But it failed to secure its most hoped for ban -- a kill shot on the Galaxy S III.

Apple attorney Josh Krevitt sums up his company's plight, remarking, "Samsung is always one step ahead, launching another product and another product."

Indeed, Apple looked a step behind in Q2.

Sources: Apple, Bloomberg, Reuters



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RE: Can not wait to see Q3 numbers!
By Reclaimer77 on 7/24/2012 7:02:26 PM , Rating: 5
If the SGS3 was the only phone Samsung made, you would have a point.

quote:
a 9 month old phone is still competitive with the brand new SGS3.


Only in the minds of sheeple idiots.


RE: Can not wait to see Q3 numbers!
By michael2k on 7/25/2012 1:38:25 PM , Rating: 2
Oh, real classy, call me a sheeple idiot.

The Galaxy S3 has been out worldwide since May, days shy of 2 months now. So 10m a month, 19m+ in two months.

Somehow, despite that, Apple still sold 26m iPhones, the majority of which were the 4S. In what bizarro world is 26m iPhones not competitive with 19m+ (extrapolated to 30m in a quarter) Galaxy S3?

Had it not been competitive, we would expect, oh, say 15m iPhones sold.


RE: Can not wait to see Q3 numbers!
By Reclaimer77 on 7/25/2012 3:45:18 PM , Rating: 2
Do you know what a yearly quarter is? It's not 2 months. And to say the GS3 has been fully available world wide that entire time, isn't entirely accurate.

And way to ignore my point about Samsung not just relying on one model.


By michael2k on 7/25/2012 4:53:23 PM , Rating: 2
What does "yearly quarter" have to do with our conversation?

But you are right, I am underreporting the demand for the GS3. Had it been fully available worldwide for the full two months they probably would have hit 30m sales.

And why is your point that Samsung has multiple models relevant? Apple has 3 concurrent iPhone models. I'm comparing Apples to Apples in this case, Galaxy S 1/2/3 to iPhone 3GS/4/4S sales.

Actually, in my more detailed comparison in a different thread, I'm shortchanging Apple by only counting 4/4S sales. So between the two powerhouses Apple has something like 165m 4+4S sales while Samsung has 73m S1+S2+S3 in approximately the same time period.


"Spreading the rumors, it's very easy because the people who write about Apple want that story, and you can claim its credible because you spoke to someone at Apple." -- Investment guru Jim Cramer














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