Tag - Wall Street
The latest episode of The MacNN Podcast attempts to understand Wall Street thinking, which is surely an exercise in madness. Apple had a record (fiscal) Q1, again setting a record for the most profitable quarter from any company ever, but the fact that the growth wasn't as significant against last year's killer Christmas season made Wall Street unhappy, particularly with the guidance that next quarter will see the first-ever iPhone drop in sales from last year's quarter.
Despite missing the analyst consensus targets for both revenue and iPhone sales in Q1, as reported earlier Apple set all-time records in almost all areas of its business; it just didn't grow as much as Wall Street had anticipated, and the news about next quarter is genuinely tough, with a significant year-over-year drop in iPhone sales, the first for the company since it introduced the product nine years ago. Despite the various troubles Apple is dealing with even amidst record revenues, there were several bright spots that got overlooked, including an important milestone in the history of Apple: one billion active devices.
Wall Street analysts are heading into the quarterly results conference call for Apple's fiscal Q1 2016 results with an expectation that the company will once again set an all-time record for quarterly revenues, handily beating last year's $74.6 billion in earnings by a current consensus estimate of $2 billion. A polling of a broader range of analysts by Fortune magazine offers an even more rosy $77.4 billion, but many analysts are concerned that iPhone sales will not top last year's results of 74.5 million units.
As previously mentioned, as far as most analysts are concerned, Apple only makes one product: the iPhone. The stock very clearly rises or falls based on that single metric, despite the fact that the company makes billions every quarter from other products and services -- the iPhone's popularity and staggering growth overshadow these factors, and at the least are seen as a leading indicator of how well Apple will be doing. Two new reports and related comments from analysts say that current speculation on Wall Street about a downturn in iPhone sales in 2016 could be off-base.
Two investment analyst firms, Barclays Capital and UBS, have issued their first predictions on the number of iPhones Apple is likely to sell in its fiscal second quarter, which concludes at the end of March. The firms disagree on the exact number of units, but are within 10 percent of each other, ranging from 54 million to 58 million units. UBS' Evidence Lab is predicting higher numbers, but Wall Street estimates remain conservative.
After falling four percent on Thursday, Apple's stock closed out the week by bouncing back and regaining more than half the drop as Wall Street reacted positively to the company's refutation of the "bending" controversy. Some new questions are being raised about the original video that started the kerfuffle, as careful observation reveals that the video was edited (and the reported noted in the video that his iPhone 6 was already slightly bent before demonstrating the flaw). Investment firms Stifel Nicolaus and BMO Capital Markets have both raised their target prices for AAPL.
There is a tendency among analysts to think of Apple as only "the iPhone maker" and ignore its other products and services, feeling that the fortunes of its most popular and profitable product -- the iPhone -- is the key to the company's overall health, at least in terms of its performance on Wall Street. Barclay's analyst Ben Reitzes told investors in a memo on Thursday that he expects AAPL to stay within a narrow range for the next two years.
Newly-released sales figures of the iPhone on Verizon in the calendar second quarter of 2013 may foretell surprising success for Apple in its core iPhone business, says UBS analyst Maynard Um. The analysis, which relies on Verizon maintaining about the same average of total iPhone sales as it has for the past year and a half, projects that Apple may have sold as many as 34.7 million iPhones between April 1 and June 30 this year, what Apple calls its fiscal third quarter. Wall Street consensus on Apple's Q3 iPhone sales calls for only 26.5 million units sold.
Reports are surfacing that Apple may release a disappointing quarterly earnings report for investors on July 23. The consensus from 35 Wall Street pundits polled exactly matches the revenue from the year-ago quarter at $35.02 billion -- meaning zero revenue growth for the quarter, which is traditionally Apple's slowest. Apple itself said it would earn between $33.5 billion and $35.5 billion for the quarter, which ended on June 30.
Despite moves to buy back shares in itself and the creation of a dividend program, Apple adds money to its enormous cash reserve far faster than it can distribute it -- a problem many companies would like to have, but one that is actually quite thorny for Apple. Wall Street appears to be orchestrating an effort -- or acting on insider information -- to put pressure on the company to make some kind of announcement for a future, additional dispersal of cash to investors. Meanwhile, governments have increased their calls for the "repatriation" of foreign-held profits.
Now AAPL Stock: 119.78 ( -0.21 )
Cirrus creates Lightning-headphone dev kit
Apple supplier Cirrus Logic has introduced a MFi-compliant new development kit for companies interested in using Cirrus' chips to create Lightning-based headphones, which -- regardless of whether rumors about Apple dropping the analog headphone jack in its iPhone this fall -- can offer advantages to music-loving iOS device users. The kit mentions some of the advantages of an all-digital headset or headphone connector, including higher-bitrate support, a more customizable experience, and support for power and data transfer into headphone hardware. Several companies already make Lightning headphones, and Apple has supported the concept since June 2014. http://bit.ly/29giiZj
Apple Store app offers Procreate Pocket
The Apple Store app for iPhone, which periodically rewards users with free app gifts, is now offering the iPhone "Pocket" version of drawing app Procreate for those who have the free Apple Store app until July 28. Users who have redeemed the offer by navigating to the "Stores" tab of the app and swiping past the "iPhone Upgrade Program" banner to the "Procreate" banner have noted that only the limited Pocket (iPhone) version of the app is available free, even if the Apple Store app is installed and the offer redeemed on an iPad. The Pocket version currently sells for $3 on the iOS App Store. [32.4MB]
Porsche adds CarPlay to 2017 Panamera
Porsche has added a fifth model of vehicle to its CarPlay-supported lineup, announcing that the 2017 Panamera -- which will arrive in the US in January -- will include Apple's infotainment technology, and be seen on a giant 12.3-inch touchscreen as part of an all-new Porsche Communication Management system. The luxury sedan starts at $99,900 for the 4S model, and scales up to the Panamera Turbo, which sells for $146,900. Other vehicles that currently support CarPlay include the 2016 911 and the 2017 models of Macan, 718 Boxster, and 718 Cayman. The company did not mention support for Google's corresponding Android Auto in its announcement. http://bit.ly/295ZQ94
Apple employees testing wheelchair features
New features included in the forthcoming watchOS 3 are being tested by Apple retail store employees, including a new activity-tracking feature that has been designed with wheelchair users in mind. The move is slightly unusual in that, while retail employees have previously been used to test pre-release versions of OS X and iOS, this marks the first time they've been included in the otherwise developer-only watchOS betas. The company is said to have gone to great lengths to modify the activity tracker for wheelchair users, including changing the "time to stand" notification to "time to roll" and including two wheelchair-centric workout apps. http://bit.ly/2955JDa
SanDisk reveals two 256GB microSDXC cards
SanDisk has introduced two 256GB microSDXC cards. Arriving in August for $150, the Ultra microSDXC UHS-I Premium Edition card offers transfer speeds of up to 95MB/s for reading data. The Extreme microSDXC UHS-I card can read at a fast 100MB/s and write at up to 90MB/s, and will be shipping sometime in the fourth quarter for $200. http://bit.ly/294Q1If
Apple's third-quarter results due July 26
Apple has advised it will be issuing its third-quarter results on July 26, with a conference call to answer investor and analyst queries about the earnings set to take place later that day. The stream of the call will go live at 2pm PT (5pm ET) via Apple's investor site, with the results themselves expected to be released roughly 30 minutes before the call commences. Apple's guidance for the quarter put revenue at between $41 billion and $43 billion. http://apple.co/1oi1Pbm
Twitter stickers slowly roll out to users
Twitter has introduced "stickers," allowing users to add extra graphical elements to their photos before uploading them to the micro-blogging service. A library of hundreds of accessories, props, and emoji will be available to use as stickers, which can be resized, rotated, and placed anywhere on the photograph. Images with stickers will also become searchable with viewers able to select a sticker to see how others use the same graphic in their own posts. Twitter advises stickers will be rolling out to users over the next few weeks, and will work on both the mobile apps and through the browser. http://bit.ly/29bbwUE