Arab Today, arab today apple shares decline after results
Last Updated : GMT 18:36:15
Arab Today, arab today
Arab Today, arab today

Apple shares decline after results

Arab Today, arab today

Arab Today, arab today Apple shares decline after results

New York - Arabstoday

Apple Inc fell after reporting iPhone sales that missed analysts’ projections, underscoring the computer maker’s reliance on demand for the smartphone. The company sold 26 million iPhones in the fiscal third quarter, shy of the 28.4 million predicted by analysts surveyed by Bloomberg. That caused Apple to miss analysts’ quarterly sales and profit estimates for the second time since 2003. Customers delayed purchases of existing iPhone versions while awaiting the next model. Samsung Electronics Co releases several designs a year to defend its lead in the $219.1 billion (Dh804.38 billion) smartphone market. That raises the stakes for Apple chief executive officer Tim Cook, who relies on a once-a-year upgrade of the device that makes up half of the company’s sales. “Pressure is mounting,” said Michael Obuchowski, a portfolio manager at North Shore Asset Management LLC, an owner of Apple shares. “Because everybody else has a much faster design cycle, Apple has to come up with a new phone that’s competitive not just when it comes out, but will stay competitive for a long period of time. That’s going to be increasingly difficult.” Net income climbed 21 per cent to $8.82 billion, or $9.32 a share, in the June period, Cupertino, California-based Apple said yesterday. Sales rose 23 per cent to $35 billion. Analysts had predicted profit of $10.37 a share on revenue of $37.2 billion, the average of estimates compiled by Bloomberg. Apple, the world’s largest company by market value, fell as much as 6 per cent to $565 in extended trading yesterday. The shares had slipped less than 1 per cent to $600.92 at the close in New York, trimming the year-to-date gain to 48 per cent.? Slowing growth? While Apple is outgrowing its closest technology-industry peers, the company’s sales climbed at the slowest pace since mid-2009. Apple said the results will be worse during the quarter now under way, as chief financial officer Peter Oppenheimer said speculation about a new device “has caused some pause” in sales. Analysts are predicting a new iPhone will be released by October. The company said sales in the quarter ending in September would fall to about $34 billion, and that profit would fall to $7.65 a share. That compares with predictions by analysts for sales of $38 billion and profit of $10.27 a share. “We have become spoiled by Apple and what they have done in the past,” said Daniel Morgan, senior portfolio manager at Synovus Trust Co. “It’s just inevitable that you’re going to have some numbers that disappoint people.”? ‘Speculating, wondering’? The results demonstrate customer anticipation for the next iPhone that will make its debut one of the biggest consumer-electronics introductions ever, according to Brian Marshall, an analyst at ISI Group. He predicts that Apple will sell 50 million iPhones in the quarter ending in December. “We try very hard to keep our product roadmap secret,” Cook said on yesterday’s call. “That, however, doesn’t stop people from speculating or wondering.” Apple sold a record 17 million iPads in the first full quarter since the device was released in March, exceeding the 15.4 million projected by analysts. Oppenheimer said sales were particularly strong in education, with one school district in Texas alone buying 11,000 iPads for students and teachers. Cook also said the company last quarter sold 1.3 million units of Apple TV, a set-top box that lets users play internet video on a TV set. That was almost triple the number from a year earlier. The company continues to explore how it can do more in the television market, he said. “It’s still at a level that we would call it a hobby, but we continue to pull strings to see where it takes us,” Cook said.? Dividend payout? Apple sold 4 million Mac computers and 6.8 million iPods, compared with 4.3 million Macs and 6.6 million iPods projected by analysts in a Bloomberg survey. Mountain Lion, the newest operating system for the Mac, goes on sale today, Apple said on Tuesday. The company hasn’t been immune to the weak global economy. Cook said sales were especially weak in Europe, where countries are grappling with high unemployment and a debt crisis. Sales in the Asia-Pacific region, which includes China, slipped 22 per cent from the previous quarter to $7.89 billion. Gross margin, the percentage of sales remaining after deducting the costs of production, was 42.8 per cent in the third quarter, and will drop to 38.5 per cent during the current period because of a product transition and a stronger US dollar value, Oppenheimer said.? Tablet rivalry? Cook is following through on a pledge to return to investors some of the company’s growing hoard of cash and investments, which rose to $117.2 billion at the end of the quarter. The company will pay a dividend of $2.65 a share to holders of record on August 13. Even as it missed Wall Street expectations, Apple’s growth still contrasts with that of other hardware makers, such as Hewlett-Packard Co, which are being hurt as customers opt for smartphones and tablets instead of new laptops. Apple’s net income compares with $2.83 billion reported by Intel Corp last week and $1.92 billion Hewlett-Packard is predicted by analysts to report next month. Hewlett-Packard’s net income projection excludes one-time expenses. With tablet sales predicted by research firm Yankee Group to overtake those of personal computers by 2015, Apple is preparing for challengers for its iPad. Microsoft later this year will begin selling its Surface tablet, while Google last month introduced its Nexus 7.? No jumping? Apple’s iPad will account for 62.5 per cent of tablet sales this year, according to IDC. The company also is preparing to introduce a model with a smaller screen, people familiar with the plans said earlier this month. Apple also is battling Samsung for leadership in the global smartphone market. While Apple has debuted one new model iPhone every year, Samsung has released a variety of handsets, including the Galaxy S3 released in May. Apple’s next iPhone will have an overhauled look and include a larger screen, people familiar with the plans said in May. The device also is predicted by analysts to have a stronger processor and work with faster long-term evolution wireless networks. Some investors are awaiting the release before issuing a verdict on Apple’s long-term health. Said Jack Ablin, chief investment officer of Harris Private Bank in Chicago: “We’re not ready to jump out the window.” From gulfnews

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Arab Today, arab today apple shares decline after results Arab Today, arab today apple shares decline after results

 



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