Apple Profit Up 38%, but iPhone Sales Disappoint Wall Street

22 Jul 2015 | Author: | No comments yet »

Apple Plunges On Light iPhone Sales, Weak Outlook.

Apple stock tumbled 8% in after hours trading Tuesday (July 21) after the company reported it sold fewer iPhones than expected in the past three months and offered a weak outlook for the current quarter.Apple revenues for the month ending June 2015 rose 33% to $49.6 billion while earnings were up 45% to $1.85 a share — beating the Thomson Reuters I/B/E/S consensus by four cents a share.Apple (AAPL) this afternoon reported fiscal Q3 revenue and profit that trumped analysts’ expectations, but missed expectations for iPhone unit sales and missed with its Q4 revenue view, sending shares tumbling in late trading.

The company sold 47.5 million iPhones, lower than the most ambitious estimates of 48 million to 50 million; it sold 10.9 million iPads, about as expected; and it sold 4.8 million Macs, a little light of consensus. The good news for iPhones was that the average selling price of $660 was above expectations suggesting that sales were better “for the larger 6 Plus model which is particularly popular in China,” according to FT. SUN VALLEY, ID – JULY 09: Tim Cook, chief executive officer of Apple Inc., attends the Allen & Company Sun Valley Conference on July 9, 2015 in Sun Valley, Idaho. (Photo by Scott Olson/Getty Images) Apple CEO Tim Cook was exuberant.

The company forecast revenue of $49 billion to $51 billion in its fiscal fourth quarter, which ends in September, short of the average estimate for $51.1 billion. If one analyst, Toni Sacconaghi of Bernstein, is to be believed, that number would indicate lower-than-expected sales of the device in the quarter, its first quarter on sale. As he said, “We had an amazing quarter, with iPhone revenue up 59 per cent over last year, strong sales of Mac, all-time record revenue from services, driven by the App Store, and a great start for Apple Watch.

Any indication of slowing demand for iPhones could spark concern that Apple is going to have a hard time selling more smartphones in the final months of the year, after the September debut of the latest version fuelled record profits. The excitement for Apple Music has been incredible.” Investors may also be disappointed with Apple’s other products revenue — it includes iPod, Beats, Apple TV and Apple Watch sales — which totaled $2.6 billion. Apple will host a conference call with analysts at 5 pm, Eastern time, this evening, and you can catch a webcast of it on the company’s investor relations site. IPad sales continued to suffer, with tablet shipments falling 18 per cent to 10.9 million, marking the sixth straight quarter of declines. – Bloomberg

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