High Apple Sales But Why are Investors Upset?
Apple

High Apple Sales But Why are Investors Upset?

Though Apple iPhone sales hit a record high recently, investors think it could have been better. Sales even hit higher than earlier estimates especially when Apple stock catapulted after releasing on Wednesday its earnings for the first quarter of Fiscal Year 2013.

Apple shares (Nasdaq: AAPL) plummeted some 5 percent during post-hours trading. However, when trading was closed in New York, Apple stock totaled $514.17, up by 1.86 percent. Observers were surprised at this trading outcome. Tim Cook, Apple CEO, remarked that no other company dealing in gadget technology has ever had this kind of result.

Sales Should’ve Been Higher

Reportedly, Apple sold a total of 47.8 million units in said quarter, almost 10 million units more than their 37 million units sold the first quarter one year ago. But no matter this performance, investors felt Apple should have pushed for selling 50 million units of iPhones instead. They were uncertain about hearsay on iPhone sales and parts until the company finally came out with its plausible earnings reports. It even turned out, Apple was coming out with a new iPhone in June.

A New Model by Mid-Year

Brian Colello, senior equity analyst for Morningstar, felt sure that a new product line will soon be in the market. As to what and when remains to be seen, he added. Recently, there had been word going around that Apple had reduced its request for iPhone parts, and observers see this as a contributory factor why its stock price fell to nearly $500. Colello said it would be interesting if Apple intently pushed the envelope as far as innovation and simplifying product cycle were concerned.

Colello said Samsung presents a major competition against Apple. Just last summer, Samsung came out with its Galaxy S III to pit against Apple’s iPhone 4S. Galaxy S III sold like hotcakes.

Sales Performance

To see how Apple sales have been doing, consider its iPad sales alone. It totaled more than 22 million units this first quarter compared to just a little over 15 million units last year. With Mac PCs, however, Apple sold only more than 4 million units compared to more than 5 million units last year. The slight slide down may be attributed to the unreleased refreshed Mac units which only came out in December last year, CFO Peter Oppenheimer said. He added that without the said delay, Mac sales may have been better.

Even the iPad sales, with 22 million units sold, was really a “disappointment,” according to Colello, and the sales total actually compared bleakly to Wall Street estimates. Overall, Apple failed to impress Wall Street but did well with its own forecasted profits—which was $52 billion in revenue. The actual revenue was over $54 billion.

Apple press release follows after the break.

Apple Reports Record Results

47.8 Million iPhones Sold; 22.9 Million iPads Sold

CUPERTINO, California—January 23, 2013—Apple® today announced financial results for its 13-week fiscal 2013 first quarter ended December 29, 2012. The Company posted record quarterly revenue of $54.5 billion and record quarterly net profit of $13.1 billion, or $13.81 per diluted share. These results compare to revenue of $46.3 billion and net profit of $13.1 billion, or $13.87 per diluted share, in the 14-week year-ago quarter. Gross margin was 38.6 percent compared to 44.7 percent in the year-ago quarter. International sales accounted for 61 percent of the quarter’s revenue.

Average weekly revenue was $4.2 billion in the quarter compared to $3.3 billion in the year-ago quarter.

The Company sold a record 47.8 million iPhones in the quarter, compared to 37 million in the year-ago quarter. Apple also sold a record 22.9 million iPads during the quarter, compared to 15.4 million in the year-ago quarter. The Company sold 4.1 million Macs, compared to 5.2 million in the year-ago quarter. Apple sold 12.7 million iPods in the quarter, compared to 15.4 million in the year-ago quarter.

Apple’s Board of Directors has declared a cash dividend of $2.65 per share of the Company’s common stock. The dividend is payable on February 14, 2013, to shareholders of record as of the close of business on February 11, 2013.

“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.”

“We’re pleased to have generated over $23 billion in cash flow from operations during the quarter,” said Peter Oppenheimer, Apple’s CFO. “We established new all-time quarterly records for iPhone and iPad sales, significantly broadened our ecosystem, and generated Apple’s highest quarterly revenue ever.”

Apple is providing the following guidance for its fiscal 2013 second quarter:

•revenue between $41 billion and $43 billion
•gross margin between 37.5 percent and 38.5 percent
•operating expenses between $3.8 billion and $3.9 billion
•other income/(expense) of $350 million
•tax rate of 26%

Bert Padilla

Founding-Editor of Cebu Tech Blogger where he shares insights in eCommerce, Digital Marketing, Ad Ops, Tech, Startups, Technopreneurship, Life Goals and Hacks. He's the brainchild and ninja of a Cebu-based digital agency, TekWorx.Digital, with ventures TekWorx, (eCommerce and Digital Marketing), AdWorx (Outsourced Ad Ops for Publishers) and BlogWorx (full-fledged Blog Development service). Read his Full Curriculum Vitae. For training and consultancy, services, speaking engagements, blog partnerships or media invites, click here. Alternatively, get in touch with him on Messenger.

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