Apple beats EPS estimates, but guides light


Apple (NASDAQ:AAPL): FQ3 EPS of $1.28 beats by $0.05.

Revenue of $37.43B (+6% Y/Y) misses by $540M.

35.2M iPhones (near expectations), 13.3M iPads (below expectations), 4.4M Macs (above expectations).

Expects FQ4 revenue of $37B-$40B, below a $40.4B consensus.

Shares -0.7% AH. CC at 5PM ET.

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Comments (59)
  • farstud
    , contributor
    Comments (263) | Send Message
     
    Nice. Hoping for a 5% pullback, itching to take a position.
    22 Jul 2014, 04:40 PM Reply Like
  • db313706
    , contributor
    Comments (223) | Send Message
     
    Although I don't use their products anymore, since I know there is a substantial population that does, I can wholeheartedly agree with your statement to initiate myself.
    22 Jul 2014, 04:44 PM Reply Like
  • Tomal
    , contributor
    Comments (2483) | Send Message
     
    maybe 1 or 2% pullback

     

    But I dont get it. They beat the EPS quite handily.
    22 Jul 2014, 04:47 PM Reply Like
  • milehr
    , contributor
    Comments (685) | Send Message
     
    Not this time. September is coming.
    22 Jul 2014, 05:20 PM Reply Like
  • Humble Eagles
    , contributor
    Comments (2758) | Send Message
     
    Apple has averaged an 18% gain from July earnings through the next 90 days over the last 5 years. With this year's blockbuster pipeline (assumes the Apple exec team isn't blowing smoke) it could make this one better than average.
    22 Jul 2014, 07:20 PM Reply Like
  • name999
    , contributor
    Comments (196) | Send Message
     
    Overall, this is a solid Q2 for Apple. Mac is the bright spot!

     

    There are too many uncertainties for the next quarter. Apple might just being conservative to give the guidance numbers. They probably won't release new iPhone(s) and other products until Sept which is the last month of their FQ4. Worst case: if mass production of new products has some constraints or delays, the new products might not contribute a lot of revenues to their FQ4. However, those revenues from new products will be postponed to the holiday season. It won't be a big deal, IMHO.
    22 Jul 2014, 04:40 PM Reply Like
  • techy46
    , contributor
    Comments (11501) | Send Message
     
    Smart phones and tablets are commodities regardless of brand, # of cores, screen size or other marketing gimmicks. We got Windows tablets starting at $149!
    22 Jul 2014, 04:44 PM Reply Like
  • IGUART
    , contributor
    Comments (451) | Send Message
     
    True, but they're Windows... and that's why they're cheap.
    22 Jul 2014, 05:07 PM Reply Like
  • milehr
    , contributor
    Comments (685) | Send Message
     
    iPhone is not a commodity, but a membership card. This is what makes Apple different.
    22 Jul 2014, 05:23 PM Reply Like
  • ConservativeOutperformer
    , contributor
    Comments (728) | Send Message
     
    That's right milehr.....

     

    A membership card into the most exclusive of all clubs. You and 50 million of your closest friends are the only ones with access due to the overwhelming initiation fee ($0 - $200) and astronomical recurring expenses ($0). Only the highest members of society can be granted access with a total cash outlay over 2 years at no higher than $200.

     

    Good luck!
    22 Jul 2014, 06:14 PM Reply Like
  • idkmybffjill
    , contributor
    Comments (1913) | Send Message
     
    ConservativeOutperformer - you sound bitter. If you want to join the Apple club, it's not that hard.

     

    Anyways, it doesn't seem to have stopped everyone else who joined the club helped make Apple the most valuable company in the world.
    22 Jul 2014, 08:12 PM Reply Like
  • rreeuwijk
    , contributor
    Comments (274) | Send Message
     
    Indeed a solid FQ3'14 for AAPL. I wonder if Mr. Blair is turning a bit less bearish as they beat his bearish estimates by a lot (again...).
    And of course we all know it's about FQ1'15, so the guidance being a bit light should not be a big deal.
    22 Jul 2014, 04:44 PM Reply Like
  • Davidoff
    , contributor
    Comments (409) | Send Message
     
    Leave the poor guy in his basement he still hasn't covered.
    22 Jul 2014, 04:50 PM Reply Like
  • doc47
    , contributor
    Comments (1766) | Send Message
     
    Right on, rreeuwjik!! Blair was last seen digging in at a "Max of 33m I-phone sales"; only to be off by 2m+. I bet he concentrates on the I-pad sales and starts bad-mouthing the I-watch when we next hear from him.
    22 Jul 2014, 07:27 PM Reply Like
  • saba01
    , contributor
    Comments (31) | Send Message
     
    As long as her stays bearish, I'm sure AAPL will do great. When his opinion changes the danger starts......
    22 Jul 2014, 09:27 PM Reply Like
  • joecole123
    , contributor
    Comments (51) | Send Message
     
    expectation is too high. these are computers not cupcakes!
    22 Jul 2014, 04:44 PM Reply Like
  • Randal James
    , contributor
    Comments (4420) | Send Message
     
    Joe

     

    I don't eat cupcakes often, but my expectations are enormous when I do! :)
    22 Jul 2014, 04:50 PM Reply Like
  • Bullmarketcall
    , contributor
    Comments (2059) | Send Message
     
    Too high is right.
    22 Jul 2014, 05:20 PM Reply Like
  • scott trader
    , contributor
    Comments (7024) | Send Message
     
    Bric was very good esp China...
    22 Jul 2014, 04:45 PM Reply Like
  • Anyoption
    , contributor
    Comments (1367) | Send Message
     
    That will be some good fodder for the bears. But I agree with joecole123. I feel that expectations for AAPL have always been just a little high.
    22 Jul 2014, 04:51 PM Reply Like
  • pjews
    , contributor
    Comments (917) | Send Message
     
    A slight decline. That's a warning for the future. Because that's how it started at Blackberry.
    22 Jul 2014, 04:53 PM Reply Like
  • civ-e
    , contributor
    Comments (690) | Send Message
     
    +6% YOY
    22 Jul 2014, 04:54 PM Reply Like
  • MattZN2
    , contributor
    Comments (1260) | Send Message
     
    Gross margin was reported at 39.4%. If there's a pull-back, it will be short-lived.

     

    -Matt
    22 Jul 2014, 04:53 PM Reply Like
  • Bullmarketcall
    , contributor
    Comments (2059) | Send Message
     
    Not too short lived. Thay need new products. Their aresenal is well used.
    22 Jul 2014, 05:19 PM Reply Like
  • freshbeginnings2006
    , contributor
    Comments (30) | Send Message
     
    well used? they still are selling 38M of that well-used arsenal when the buzz on the street is that there will be new weapons in a short time. Wow, Einstein!
    23 Jul 2014, 01:49 AM Reply Like
  • bgold1955
    , contributor
    Comments (2351) | Send Message
     
    Should be last qtr to miss on iPad as back to school this qtr & holiday next qtr. iPhone up 12.6%, Mac up 12.5%, iPad down 9.1, eps up 19.6% & rev up 5.9% all yoy.
    22 Jul 2014, 04:54 PM Reply Like
  • freshbeginnings2006
    , contributor
    Comments (30) | Send Message
     
    I would not be surprised if the iPad will be the new iPod. It will help sell more high margin iPhones/phablets etc.
    23 Jul 2014, 01:51 AM Reply Like
  • financeminister
    , contributor
    Comments (1218) | Send Message
     
    AAPL hasn't collapsed and is just a few basis points down after hours... I think tommorow will be an up day after an analyst or two gives a positive spin.
    22 Jul 2014, 05:03 PM Reply Like
  • jdadyfinance
    , contributor
    Comments (238) | Send Message
     
    The numbers that come out of Apple quarter after quarter are just mind numbing. There is no investment thesis based on any fundamental metric that currently exists that makes a case against owning Apple. The whole idea that you can not pursue a premium brand strategy in a commoditized space has been disproved and market share over profit share has and always will be a terrible business model. Samsung has stumbled and the timing could not be better for Apple. I would not for a moment underestimate Samsung long term but it may be too late if the rumours of coming products are true. APPL is cheap and I would not be afraid to step into it here.
    22 Jul 2014, 05:03 PM Reply Like
  • Bullmarketcall
    , contributor
    Comments (2059) | Send Message
     
    Cheap it is. Cheaper it was 12 months ago. Yes, the same products, the same managment, same market. Not as cheap as some time ago.
    other stocks are really much cheaper.
    22 Jul 2014, 05:18 PM Reply Like
  • David at Imperial Beach
    , contributor
    Comments (4381) | Send Message
     
    You can gloat now, but the story's not over yet. Apple actually proved with the Mac against the PC that you can *not* pursue a premium brand strategy in a commoditized space. Then Steve Jobs reinvented Apple but they still haven't learned their own lesson yet with the iPhone. Give the market forces enough time and the strategy will once again prove to be defective. Apple's strategy only works as long as the pipeline of new products does not get bogged down. But the new products are now dangerously overdue, and Apple is guiding to not expect any results from new products this upcoming quarter either.
    22 Jul 2014, 06:50 PM Reply Like
  • Randal James
    , contributor
    Comments (4420) | Send Message
     
    David

     

    What you suggest is precisely the conundrum. Lots of Apple holders are long and would stay that way even as they were closing the last store and selling building signs on ebay. But the pipeline isn't exactly robust or the guidance would be strong. Many feel the new form factor that finally has the size that a slice of the market prefers will mean not just an upgrade for current users, but stealing points away from competitors who already have the large screens, such as (duh alert) Samsung and Sony, among others.

     

    The soft guidance suggests that the rumors of a delay in the introduction may be true. It will indicate that maybe the Big Un won't make its debut until the October period or even later - not that having a highly visible product launch in the holiday quarter is a terrible thing. The OS is supposed to be dramatically changed as well. Will it be a natural upgrade or suffer the same unfamiliar backlash that Windows found with 8.0? Where's the iWatch?

     

    These should be questions longs keep in mind because the stock isn't priced for perfection but it is priced for continued success, not delays and uncertainties. It is impressive that they've told Foxconn they want to be prepared to build a huge number of phones. If they keep those production targets, all will be well in Cupertino.
    22 Jul 2014, 07:20 PM Reply Like
  • Bull Rider
    , contributor
    Comments (574) | Send Message
     
    Earnings beat is meaningless they bought back 5 billion worth of stocks what ii important is revenue beat and operating margin improvements which mean growth and cost of goods sold under control. Think the market will shoot up!
    22 Jul 2014, 05:05 PM Reply Like
  • David RG
    , contributor
    Comments (2889) | Send Message
     
    Revenue did not beat. It missed.
    22 Jul 2014, 07:16 PM Reply Like
  • BBBerry
    , contributor
    Comments (31) | Send Message
     
    And it still has huge cash reserves. Enough to buy a few countries...
    22 Jul 2014, 05:08 PM Reply Like
  • Mark Krieger
    , contributor
    Comments (6385) | Send Message
     
    they always guide light. That called under promising ( aka sandbagging).Don't the analysts understand the routine? dumb asses!
    22 Jul 2014, 05:16 PM Reply Like
  • David at Imperial Beach
    , contributor
    Comments (4381) | Send Message
     
    Yes, as a matter of fact, the analysts do understand that. That's why they typically expect Apple to beat estimates and get really disappointed if they only meet guidance.
    22 Jul 2014, 06:28 PM Reply Like
  • civ-e
    , contributor
    Comments (690) | Send Message
     
    they said specifically a few quarters ago that they would not try to do that on purpose but to give a range they think is accurate. not that it should matter to long term believers of the company's prospects.
    22 Jul 2014, 06:38 PM Reply Like
  • Bullmarketcall
    , contributor
    Comments (2059) | Send Message
     
    This the bell that calls > Sell when people are overconfident.... All they said> Expect beat. happened. Good call. What about guidance? Not that they are waiting for a top beat number. That could complete a good turnaround to 85, as happened every time this stock been overvalued. This is a time to sell. Buy back in 4 months. Buy in before year end. The time for Apple train has been last 12 months. Every bull dumb that advised to buy at that point based on products, earnings whatever was a speaking toooo much.
    22 Jul 2014, 05:17 PM Reply Like
  • jdadyfinance
    , contributor
    Comments (238) | Send Message
     
    How is earning beat meaningless? Fewer shares = more revenue for existing shareholders. Fewer mouths to feed basically , far from meaningless. I will concede had there been no revenue growth then it's the old IBM shell game or more diplomatically financial engineering.
    22 Jul 2014, 05:18 PM Reply Like
  • Kevin Murphy
    , contributor
    Comments (108) | Send Message
     
    Remarkable beat on iPhone when everyone knows the products will be updated within months. Same for Macs, the new products were not out yet during this reporting period. We are just beginning to see the potential of AAPL to be both the Win and the tel of the old Wintel duopoly.

     

    The most important devices for the sales & marketing side of corporations are becoming the iPad and iPhone. They both run iOS compatibly. This makes it so much simpler for IT execs to solidify on an AAPL platform for apps for their field sale force. Not to mention security and reliability over Android devices. Also consider that sales reps don't want to be carrying cheap Samsung phones or pads in front of customers.
    22 Jul 2014, 05:33 PM Reply Like
  • 2ng
    , contributor
    Comments (219) | Send Message
     
    I concede more importance to the beat on iPhone since it has a more important fashion-item component than macs, so it suffers more its periodical changes IMO
    22 Jul 2014, 05:46 PM Reply Like
  • David at Imperial Beach
    , contributor
    Comments (4381) | Send Message
     
    Apple is on the cusp between being a value company (cash cow) or being a growth company (fast cow). Value companies are judged according to different (more conservative) criteria than growth companies. Growth companies command higher P/Es, and the market doesn't actually insist on any earnings at all. Apple would like to be there, but without new products it no longer qualifies. No revenue growth = low P/E. Sorry.
    22 Jul 2014, 06:55 PM Reply Like
  • David at Imperial Beach
    , contributor
    Comments (4381) | Send Message
     
    Any IT department worth its salt will insist upon higher security than available in iOS. Right now that's BES. If security isn't an issue, then they will also insist upon cross-platform compatibility so that they are not trapped into expensive devices with an accompanying expensive ecosystem.
    22 Jul 2014, 06:58 PM Reply Like
  • Stephen Aniston
    , contributor
    Comments (3476) | Send Message
     
    The Surface Pro 3 is going to clean the iPad's clock in corporate sales. Nobody's outside the hard-core fans is gonna buy their new iPhone either. There are competing Android phones for $150 with the same functionality. Apple will continue to lose market share to Android.
    22 Jul 2014, 07:58 PM Reply Like
  • saba01
    , contributor
    Comments (31) | Send Message
     
    On the cheap side yes; on high end no...And the high end has the profit!
    23 Jul 2014, 12:32 AM Reply Like
  • june1234
    , contributor
    Comments (4414) | Send Message
     
    With all that pent up demand for bigger screens and a 90% customer loyalty rate I expect the next iPhone will be a huge hit with fruit customers
    22 Jul 2014, 06:07 PM Reply Like
  • David at Imperial Beach
    , contributor
    Comments (4381) | Send Message
     
    Fruit? Mangos? Pears? I wasn't aware that fruit required cellphones.
    22 Jul 2014, 07:00 PM Reply Like
  • Tomal
    , contributor
    Comments (2483) | Send Message
     
    iPhone 6 will be the biggest upgrade cycle in US. Just wait and see. But yes after this happens, I dont see any more upside in AAPL. So AAPL will have a huge run up till next year.
    22 Jul 2014, 11:39 PM Reply Like
  • rich@defense
    , contributor
    Comment (1) | Send Message
     
    In the mean time, collect a pretty good dividend.
    22 Jul 2014, 06:17 PM Reply Like
  • a alto
    , contributor
    Comments (357) | Send Message
     
    Microsoft s and Samsungs earnings reports were pathetic . Apple is the only one of the big three still crushing it ! And new products are coming , no way in hell am I selling Apple stock .
    22 Jul 2014, 06:39 PM Reply Like
  • skleiniv
    , contributor
    Comments (88) | Send Message
     
    Any other company hitting numbers like these would have a skyrocketing high stock price. It never fails to amaze me that such a great company with an amazing cash flow doesn't leap with such a good earnings report. I've been in it for the long haul & continue to be. Most of my family and friends are all waiting for a bigger screen. I could have upgraded a year ago but didn't because my phone works great & all I want is the bigger screen. I think a lot of people are waiting like me. So I see the bigger screen phones as a huge catalyst for the next quarter provided they come out with it soon.
    22 Jul 2014, 07:02 PM Reply Like
  • jsmunroe59
    , contributor
    Comments (122) | Send Message
     
    Only the jealous, shallow minded, and short sided do not see the quality and logarithmic growth this company represents. The shorts will scream in pain as this company continues to become ubiquitous in ALL our lives!
    22 Jul 2014, 07:52 PM Reply Like
  • Shaduc
    , contributor
    Comments (2984) | Send Message
     
    "Only the jealous, shallow minded, and short sided do not see the quality and logarithmic growth this company represents. "

     

    Apple represents a sector of an industry. Perhaps it represents more the vanity of Global consumers ...
    22 Jul 2014, 09:24 PM Reply Like
  • mtairyinvest@aol.com
    , contributor
    Comments (182) | Send Message
     
    The analysts on CNBC all said there was no risk in Apple stock at all.

     

    Is that like a no-brainer? One said the "retail investor" should buy a new iPhone AND some of the stock too.

     

    Although he also mentioned that he was an Android user himself.
    22 Jul 2014, 08:20 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (34911) | Send Message
     
    "No risk" "no-brainers" usually end up having a lot of risk.

     

    Going into earnings today, calls were trading massively more than puts. Everybody's an optimist.

     

    Yet the earnings were not that amazing, and neither was guidance, iPhone sales or iPad sales.

     

    Anyway, the prospect of new products is holding things together. If the iPhone 6 was already out, the stock would have sold off on today's news.
    22 Jul 2014, 08:44 PM Reply Like
  • Mark Krieger
    , contributor
    Comments (6385) | Send Message
     
    I am glad I sold my long position. It has been one hell of a ride, but I refuse to be greedy. There are much better fish in the sea to be had.
    22 Jul 2014, 08:47 PM Reply Like
  • freshbeginnings2006
    , contributor
    Comments (30) | Send Message
     
    I would be curious to know what better fish a non-greedy person would be looking at..
    23 Jul 2014, 01:57 AM Reply Like
  • Rollo Tomasi
    , contributor
    Comments (273) | Send Message
     
    This earning report really means nothing, although that may seem hard to believe the stock will continue to be driven by the new iPhones, iPad air2, iwatch, ipayments, and Apple TV. The traction from new products is really the story, not whether they forecast 39.8b versus estimates of 40.2b for q4..
    22 Jul 2014, 10:48 PM Reply Like
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