“Building on continued momentum of its iPod players, Apple Computer Inc. nearly doubled its net income on record revenue and easily topped Wall Street expectations. But a soft forecast for the coming quarter drove Apple’s shares down more than 3 percent in extended trading Wednesday,” May Wong reports for The Associated Press. “For the second fiscal quarter, Apple said it expects revenue of about $4.3 billion and earnings per share of 38 cents, including an estimated non-cash share-based compensation expense of 4 cents a share. Analysts were expecting earnings of 48 cents a share on revenue of $4.6 billion, and questioned why the guidance was so conservative.”
“Apple’s chief financial officer, Peter Oppenheimer, explained during a conference call that despite an ‘extraordinary response’ to the new iMac desktop and MacBook laptop unveiled last week, the company would start shipping the MacBook in February, limiting its impact for the quarter,” Wong reports. “Oppenheimer also indicated Apple might experience a continued ‘pause’ in Mac sales, which the company saw in its first quarter due to customer anticipation of new computers in the coming year.”
“For the three months ended Dec. 31, the maker of Macintosh computers and iPods said it earned $565 million, or 65 cents per share, up from $295 million, or 35 cents a share in the year-ago quarter. Apple revenues soared to $5.75 billion up from $3.49 billion a year ago… Apple shares slumped 3.3 percent in late-session activity, down $2.71, after the report was released. Earlier, the stock fell 2.6 percent, or $2.22, to close at $82.49 on the Nasdaq Stock Market, dragged down by investor disappointment from lackluster results at Yahoo Inc. and missed expectations from Intel Corp. American Technology Research analyst Shaw Wu said the stock was likely just correcting itself. ‘Expectations were getting out of hand,’ he said. ‘And it’s good to see Apple trying to reset them.’ The leaner outlook would still mark the second-best revenue quarter in Apple’s history, Wu said.”
Full article here.
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Time to take a breather on the stock euphoria.
Buying op. in anticipation for the rest of the year?
Burst.com. A fly in the ointment. If resolved, I would expect nopt only a large announcement, but a stock price revision (if such things are done, that is…).
American Technology Research analyst Shaw Wu said the stock was likely just correcting itself. ‘Expectations were getting out of hand,’ he said. ‘And it’s good to see Apple trying to reset them.’ The leaner outlook would still mark the second-best revenue quarter in Apple’s history, Wu said.”
—-
And some other stats…
If Apple executes a “mere” $4.3 billion Q2…
…that’s a 30%+ increase in revenue over the Q2 ’05.
…that’s $10 billion for the half year compared with $13.93 billion for the WHOLE of FY2005. So 70% of the previous year’s revenue with two quarters left and a lot of new product still to come, most of with a lot of latent market demand.
…Apple would be well on their way to a 35% revenue increase for FY2006 when compared with FY2005. 35% would mean $18.80 billion and would also probably mean around $2.0 billion in profit. However, given the new product coming on stream during 2006, 45% and $20.2 billion (and $2.15 billion in profit) aren’t beyond the realms of possibility, so long as they avoid the doldrums normally associated with the June quarter.
Of course, if Apple are truly sandbagging on the $4.3 billion figure and they land up executing $5.0 billion (or over) fuelled by Europeans who couldn’t get their hands on an iPod for Christmas, then $20 billion will seem like an almost racing certainty.
Well come on! Nobody in their right mind should expect stock to rise continously. It’s investing in the longterm that counts.
Apple had a great run before the holidays, lots of iPods and Mac’s were sold, now since the demand for consumers has been met and the professionals are waiting for the Mactel versions of software before getting a Mactel, it’s obvious that this could be a slow quarter.
Doesn’t mean it’s going to last, it’s just a opportunity to get the inflated Apple stock down to something more realistic so it doesn’t take a nose dive next quarter when the less than expected results are announced.
PC sales haven’t been too good on the Windows side either, just look at Intels gloom and doom.
Apple had a heyday with a unexplored consumer nitch, fine, now it’s time to realize the ride to the top is over and the roller coaster ride is to begin.
So if your in or out depends on what type of trader you are. Longterm or shorterm.
I would wait till the end of this quarter to buy.
Oh if your not cloning your hard drive you are a utter fool.
http://homepage.mac.com/hogfish
Just read this, everyone is waiting for dual cores
http://news.com.com/PC+market+surged+in+2005,+will+settle+in+2006/2100-1003_3-6028454.html?part=rss&tag=6028454&subj=news
They have to bee conservative. People get too hyped up about it so it’s only prudent they are conservative.
It follows one basic tenent of business:
Underpromise, Overdeliver.
Mark my words–it will split again and rise back into the $80s.
The “analysts” have no idea what is really going on in the tech, pc, consumer electronics industry. We are in the middle of a dramatic changing of the guard in the pc industry (with Linux playing a major role) while Apple is in the middle of morphing from a niche computer company to a global consumer electronics company. MS has slit its own throat so that it will slowly become what IBM became when they fumbled the ball.
Ten years from now the tech/PC landscape will be *completely* different and Apple will be a large part of that (as well as open source).
Maybe I’m completely wrong, but while all the “experts”, “analysts”, and naysayers have been predicting gloom and “it’s got to slow down now” for the past five years, I have made a fortune on stock. A key Motley Fool analyst did that for three years until he finally gave up, bought Apple, and recommended everyone else do the same.
We’re only half way there–Apple stock has got at least another two years of steady growth left in it. Buy, buy, buy . . .
Apple is still executing better than others. In terms of music, there is no one else who can immediately displace the iPod/iTunes combo. In terms of the Mac, what could possibly be a bigger threat to the Mac than all the crap in years gone by? The Mac business will also grow. In terms of emerging markets and such– Apple is poised to grow, in part, because of the strong execution is ALL of its other endeavors.
Good times ahead, folks. Even with a “lower than expected forecast” this next is Apple-predicted to be the 2nd largest even after a holiday season.
Love this company!
I agree with Auctoris. There is a major change in the air and while Linux will play a roll in it, it will be nothing compared to what you are going to see on the Macintosh front. I am not a long time Mac fanatic (not that there is anything wrong with Mac fanatics). I just started using them in 2004. But I can tell you there are some things going on that the analysts are completely blind to. Here is another prediction: Windows Vista will NOT be released in 2006 – I repeat, it will NOT be released in 2006. There is mounting evidence that the Macintosh platform is the next platform of choice which is one of the many reasons it was time to move it to the Intel platform.
Search the web for what Microsoft has been up to in terms of software, web services, hardware, etc. You will see that even Microsoft is giving up on Windows. They are relegating it to a legacy platform and instead will begin focusing on services (live.com) that will work on any OS platform.
If you believe in the long-term prospects of a company – any company – then you buy its stock whether it’s up or down. You set aside a share of your paycheck and buy shares in the company when payday comes around. It’s that simple. Anything else is speculation.
Of course, Wall Street wasn’t called the Largest Casino In The World for nothing…
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But Apple can’t do squat without a large supply of processors.
Right now Apple is saying they won’t be able to meet demand for the new MacTel Book Pro’s.
This is because Intel is having trouble with the Core Duos and Dell and HP are bitching a snit they didn’t first crack at them.
Once Intel ramps up all their facilities it will be a “pull out all the stops” at Apple.
Perhaps IBM found out something and that’s the reason they didn’t develop a cool enough duo-core G5 for laptops.
All the greatest minds in the world work for IBM, Intel might just be finding out what IBM already knows.
Just look at the performance here iMactel vs iMac G5, not much difference!!!
http://www.macworld.com/2006/01/features/imaclabtest1/index.php
They can’t get processors to go any faster and doubling up processors/cores is only a temporary measure.
The problem is demand for powerful portable computing and cool chips are not possible.
Evil…
Though your name is “of that which should not be spoken,”
I agree.
MacDude,
Though your name contains “that which should be said often but may conflict with previously adhered-to statements,”
I agree!
Oh, the macintoshany!
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MacDude’s theory is complete bunk. Intel isn’t having some kind of “problem” with the Core Duo; these are just regular production ramps which occur whenever you have a new chip that is in high demand.
IBM did not find anything out; IBM simply does not care. That’s the long and the short of it. IBM cannot produce the world’s best processors because they don’t want to badly enough.
One operative phrase might be “below analysts’ expectations”. We endusers and Mac-faithful have very different expectations than the analysts and institutional investors. Too much emphasis on Wall Street’s short-term (whether measured in days, quarters or annual) gambling addiction, always looking for that hot little pony cueing up to the gate for the next race.
Yeah looks like Steve was spraying the kool aid when he talked about the speed of the Intelmacs being 2-5 times faster. From Macworld magazine:
“However, we found that those improvements are generally much less than what Apple claims is a 2x improvement in speed.
Instead, our tests found the new 2.0GHz Core Duo iMac takes rougly 10 to 25 percent less time than the G5 iMac to perform the same native application tasks, albeit with some notable exceptions. (If you’d prefer, that makes the Core Duo iMac 1.1 to 1.3 times as fast.) And we also found that applications that aren’t yet Intel-native—which must run using Apple’s Rosetta code-translation technology—tend to run half as fast as the same applications running natively on the iMac G5.
Just how fast will Rosetta run non-Universal programs? With this new iMac, we’re finally able to get the first clear answer to that question.
We tested three different non-native applications on the Intel-based iMac, and compared the results to the iMac G5. All of the tests showed that PowerPC applications run on the new iMac at less than half their native speed. Our standard Microsoft Word scrolling test ran at 48 percent of the speed it ran on the iMac G5; our standard battery of 14 Photoshop CS tasks ran at 45 percent of the G5’s speed; an MP3 encode using the non-native iTunes 6.0.1 ran at 34 percent of the speed.”
http://www.macworld.com/2006/01/features/imaclabtest1/index.php
I will wait before I buy to see what develops.
I wish somebody would test the same software on a PC vs Mac dualcore intel machine. Curious to see which is faster.
Wow – those Macworld stats seem to back up just what I’ve been thinking would be the case with these new Intel Macs.
An average 20% speed improvement over a *single core* G5 is absolute crap. A best increase of about 85% in a test over the G5 is also pretty poor.
The Rosetta speed is also pretty dsappointing.
From those stats I would expect a *dual core* G5 to be slightly faster than the Intel Core Duo. Right now I’d much rather get a dual core G5 than an Intel Core Duo.
With that kind of performance we’re going to be waiting a long time before Apple replaces the G5 in the PowerMacs – they’ll need the next generation of Intel chips coming late this year to match (or possibly better) the G5 chips they’re using right now.
This performance is *seriously* bad.
MDN, FUCK OFF WITH THE POP UNDERS!
Re the performance issue.
Steve Jobs stated that the performance ratings were based only on SpecInt measurements and that they were not predictive in any way of actual performance of applications.
But the fact remains that the new Intel iMacs are generally faster than the G5 iMacs for the same price. It still sounds like a good deal to me. If I can afford to buy a new Mac within the next 2 months as I would like to do, I will most certainly buy the Intel iMac. As I’m upgrading from a nearly 6 year old G4/400, even the performance of apps running under Rosetta will seem like an improvement.
The benchmarks aren’t disappointing at all, I’m not sure what some people are smoking. A 20-80% real world speed improvement over the G5 model is outstanding (especially considering they cost exactly the same). Plus, once all of the apps are converted to Universal, the Rosetta speed issue will be a total non factor anyway.
Make mine a dual-single-dual-core rather than a single-single-dual-core or a dual_single single-core as long as it’s faster.