Wall Street has been disappointed with the quarterly results of Apple Inc.(NASDAQ:AAPL). It had expected bigger sales of iPads.
Apple’s stock traded off modestly in the after-market. However, it immediately bounced back.
Apple has recently revamped its product lines. It has launched a new iPhone, new iPods, new iPads and new Macs. In spite of reports stating supply-shain problems, especially for the iPhone 5, David Garrity, a principal of GVA Research, is of the opinion that Apple is poised to have an outstanding fourth quarter. Investors have already started focusing on that.
As far as next year is concerned, Garrity thinks that Apple will do fine. There are still hundreds of millions of prospective new customers for Apple products that have been launched recently. For an example, China Mobile is about to strike a deal to sell iPhone to its hundreds of millions of subscribers and when it actually does that, Apple will have access to a massive new market.
Apparently, a decent amount of negativity surrounding the quarter had already been priced into the stock and that is probable why the stocks are not down more after Apple missed earnings expectations.
Mac sales for the fourth quarter were slightly less than the estimates. Only 4.9 million units were sold whereas there was an expectation of 5 million. The figure represents only 1% in Mac sales on a year over year basis as compared to expectations for growth of unit around 2.25%.
Also, the reduction in iPod sales was larger than predicted. Apple sold 5.3 million iPods in the quarter, a 19% decline when compared to the same quarter last year.
Apple has become notorious for providing guidance. It is incredibly conservative and the poor outlook will probably be discounted by investors. Most on Wall Street have a tendency to skip the company’s guidance since it has proven almost very low in every quarter.