Apple to have a red Friday but will it be a bleak Wednesday?

 

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ROUNDUP am January 24

From Apple:

From elsewhere:

 

 

 

Instant analyst opinions/headlines:

Our view: The iTones they are a-changin’ (to follow)

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UPDATE -  9.45pm & 10.45PM ish  GMT Apple Q1 2013 (Q1 2012) results

  • Revenues $54.5 ($46.33) billion
  • Net profit $13.1 ($13.06) billion
  •  Earnings per share $13.81 ($13.87)

They seem to be  in line with (or marginally below) general expectations but their quarter 2 guidance is lower than expectations.

  • iPad at 22.9  million unit sales are in line with expectations
  • iPhone at 47.8 million unit sales are inline with expectations

Expectations are taken as the average Professionals forecasts which might also be regarded by some as “The Street”!

Share price (per the WSJ) after hours is currently (11.30pm GMT) down $54 at $460 (It closed the day unofficially at $514.00)

We’re off to complete our schedule and will be back later just before the earnings call

Press release

Earnings release

SEC filing

Our schedule is now updated

The conference call is underway and is, to us, rather full of “change”. Some restatement of past cost and revenue allocations and geographic definitions eg China gets more prominence. Possibly the most confusing change is the basis of providing future guidance which historically has been super conservative. It was “single point” in the past but in future it’s going to be in a range and there’s a sort of implication that the results WILL BE in the range.

The specifics given for Q2 are:

  • Revenue $41-$43 billion
  • Gross margin 37.5% – 38.5%
  • Operating expenditure $3.8 – $3.9 billion
  • Other operating income $350 million
  • Taxation 26%

So our instant calculations give a net profit range of $9.7 billion to $8.8 billion.

In the current reporting quarter Apple exceeded its Net profit guidance of $11.2 billion by some 18% at $13.2 billion.

This may partially explain why the shares are now down some $54 in after hours trading.

We will do a round up tomorrow & include a summary of how the results are being viewed elsewhere.

The Conference call ended with what sounded to us like some rather dated motown music! There no doubt will be some hidden significance that we missed!

In other news Netflix announced results significantly lower than last year but ahead of their guidance  and their shares are up by nearly a third!

Apple’s 1st Quarter earnings for 2013 (the 13 weeks ended  December  29 2012) will be released some 30 minutes after the closing bell tonight ie 9.30pm ish GMT. We will return to update you with the results and some instant views once announced.

Subsequently at 2pm PT (10pm GMT) they will hold their Conference Call which you can listen to from their website.

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Some are saying that they may show the first profit decline in a decade whilst others are positively highlighting their upcoming product release and development schedules for the remainder of 2013.

The share price has come back to around $500 from its $700 peak (Closing yesterday was $504.77). We are sort of low balling our guess, allowing for the fact that the comparative quarter last year covered a 14 week period rather than this times 13. So with no growth one could expect a revenue, earnings and unit sales reduction of 7.1%. Also the average sales price of iPads will reduce (possibly by up to 15%) due to the introduction of the iPad mini.

We have as before included Phillip Elmer-DeWitt’s excellent abstract of the numerous (67 this time) analysts and their predictions. This quarter he is coordinating his analysis from the Far East which could make it even more exciting! We have also (E & O E) calculated averages (mean) for the Professionals and Independents revenues margins, earnings per share and unit product sales numbers.

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To sort of complete the picture we’ve done one of our little tables that summarises the information and includes the (we think rather wide) ranges that exist amongst the analysts forecasts. iPad sales forecasts for instance vary by almost 100% starting at 16.8 and going as high as 32 million!

We’ve put up our schedule of the quarters forecast from Apple’s guidance through our own guess and will return later on to update it and you with all the numbers.

To celebrate the Chinese New Year (coinciding incidentally with Burns night!) Apple are having a Red Friday sale (sort of ala Black Friday) for customers in their Asian online stores (uncertain about the physical ones but likely there as well).

 

Note. Apples guidance figures for Income (before taxes and Net) have been calculated by ourselves from the Apple information given in their last quarters results and conference call.

Disclosure: We have no position in, nor commercial arrangements with, Apple Inc

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