Apple Earnings Worry Investors; Stock Falls 10 Percent
January 23, 2013 7:06 PM
Apple's profit is flat due to higher manufacturing costs
While Apple managed to surpass analysts' profit forecasts for the fiscal 2013 first quarter, the company's stock took a tumble as investors worry over Apple's
ability to maintain steady growth
with new products.
Apple reported a revenue of $54.5 billion for the quarter ended December 29, 2012, compared to $46.33 billion in the year-ago quarter. The tech giant just missed analyst expectations of $54.73 billion.
Apple also earned a net profit of $13.1 billion ($13.81 a share) compared to $13.1 billion ($13.87 a share) a year ago. Profit clearly remained pretty flat, but it exceeded analysts' expectations of $13.44 a share.
The iDevice maker also noted that it had record iPhone sales for the quarter at 47.8 million (compared to 37 million in the year-ago quarter). It also had an uptick in iPad sales, from 15.4 million in the year ago quarter to 22.9 million in the most recent quarter.
“We’re thrilled with record revenue of over $54 billion and sales of over 75 million iOS devices in a single quarter,” said Tim Cook, Apple’s CEO. “We’re very confident in our product pipeline as we continue to focus on innovation and making the best products in the world.”
While Apple did okay for the quarter, investors are concerned with the company's flat profit due to higher manufacturing costs and also worry whether Apple can keep up its momentum with product popularity. Many new devices are hitting the market at lower prices and offer newer, better features. For instance, the
iPad's market share was bested by Google's Nexus 7 tablet
in Japan mainly due to cost differences.
Apple's stock has lost nearly 25 percent of its value since September 2012 ($170 billion in market value).
In after-hours trading today, Apple's stock fell over 10 percent.
Looking forward to fiscal 2013 second quarter, Apple expects a revenue of between $41 billion and $43 billion.
Earlier this month, it was reported that Apple had
cut iPhone screen and component orders by 50 percent
he first quarter of 2013.
"I modded down, down, down, and the flames went higher." -- Sven Olsen
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