Wall Street To Apple: Q3 Earnings Not Good Enough
October 18, 2011 at 3:59 PM (PT)
APPLE INC. reported quarterly results of $28.27 billion, an increase that was lower than WALL STREET expectations, which lowered APPLE stock by more than 5%, REUTERS reports. APPLE sold 17.7 million iPHONES in the quarter, which was lower than analyst predication of 20 million, and turned in a net profit of $6.62 billion, which also fell shy of expectations.
"Expectations for this company were red-hot, that is why we downgraded it," BGC PARTNERS analyst COLIN GILLIS said. "The reality is their business is not an annuity. They have to sell their quarter's worth of revenue every 90 days ... They had a big upgrade cycle with the IPHONE, the numbers came in weak. They need to set records every time they report to keep up the momentum."
APPLE CFO PETER OPPENHEIMER said iPHONE sales came in ahead of internal expectations but were hurt in SEPTEMBER by customers waiting for a new version. "There's no question this was a transition quarter ahead of the 4S," said WP STEWART portfolio manager MICHAEL WALKER. "With the early pace of iPHONE 4S sales, my guess is that disappointment is relatively short-lived."