Citing the strength of iPad and iPhone demand, one Wall Street analyst Friday increased his estimate of Apple’s second quarter earnings. The Cupertino, Calif. company will likely announce $24.42 billion in quarterly earnings, up from a previously projected $24.42 billion, according to J.P. Morgan.
Analyst Mark Moskowitz told investors he foresees Apple selling 18.4 million iPhones, up from 16.6 million. He however slightly trimmed his expectations for iPad 2 sales to 5.4 million units, down from 6 million. Moskowitz concerns about the iPad 2 were “timing related and not structural,” citing a “temporary stall-out of shipments.” The analyst recently announced Apple held an “insurmountable lead” in the tablet market and the iPad 2 could burst the bubble of rivals trying to catch up.
Earlier this week, Moskowitz told investors a CDMA iPhone could be a $9 billion opportunity for Apple, helping fuel iPhone growth in global areas supporting the CDMA technology, such as China and India.
The analyst expressed concern a scheduled rebalancing of Apple’s stock on NASDAQ could mean the sell-off of around 8 million shares representing half of Apple’s daily trading volume.
For the Mac product line, the analyst sees 32 percent year-over-year growth with 3.89 million units sold, a slight uptick from the his previously projected 3.85 million Macs. He referred to the MacBook Air as still offering “breakthrough performance” first seen in the first quarter of fiscal 2011.
Apple will announce its quarterly earnings Wednesday, April 20.
Ed Sutherland is a veteran technology journalist who first heard of Apple when they grew on trees, Yahoo was run out of a Stanford dorm and Google was an unknown upstart. Since then, Sutherland has covered the whole technology landscape, concentrating on tracking the trends and figuring out the finances of large (and small) technology companies.
12 responses to “Analyst: Apple May Earn $24.42B in Second Quarter”
“$24.42 billion in quarterly earnings, up from a previously projected $24.42 billion”
Typo or new math? ;)
Google’s share price already got seriously hammered by WS on earnings. Let’s see if Apple gets hammered just as badly or possibly a lot worse. All this ridiculous revenue hype is going to bite Apple shareholders in the behind when WS becomes unimpressed with any number Apple can deliver. I almost understand why Apple’s share price continues to fall into earnings. No sensible investor wants to get suckered into being under a falling guillotine, at least one of Apple’s size and weight. Analysts are turning Apple into a classical stock of over-promise and under-deliver when it comes to earnings. I doubt if Apple can boost its share price without acquiring another company for added revenue. It’s rather amazing that such a company can continue to make as much money as it does and still the share price drops.
I remember earlier in the year when analysts were talking about how Apple was going to supposedly compete with ExxonMobil in market cap. XOM is looking stronger by the day and has left crippled AAPL somewhere back in a cloud of dust. It appears that all the hype in the world didn’t interest investors to buy Apple and now XOM and AAPL are headed in opposite directions. I’m just giving my observation, not a prognostication.
It’s supposed to be “…up from a previously projected $23.83 billion.”
Your reply makes it sound as though you believe AAPL to be currently overvalued. I’d be interested in the data you use to come to that conclusion. By almost every metric I know of, AAPL currently is seriously undervalued. I understand that, for whatever reason, Wall Street is not going to give AAPL the valuation it deserves, but for a company that has grown revenues/earnings at a 50%+ pace annually over the past five years, actually grew them by over 70% last year, and will likely continue to grow at 25+% (I’m being very conservative with this number) for the next few years at least, AAPL currently is trading at a 13 p/e ($328/$25 in EPS this fy) BEFORE stripping out the $60 per share in cash/investments on the balance sheet. Back out the cash and the p/e drops to about 10. I believe that once the NASDAQ rebalancing is completed on May 2, the downward pressure on the stock will evaporate (provided that AAPL does not bomb the earnings announcement on the 20th) because this valuation makes no sense. For investors to still believe that AAPL is a fad stock, that w/o Steve Jobs it cannot execute, that the halo effect is a myth, that Android is killing AAPL’s ability to grow, that the iPhone 5 won’t ship until next year, that profit margins are unsustainably high, the tablet competitors will catch and pass Apple, that Apple is out of ideas, that the cash is not really the boon that it seems because much of it has to be repatriated, that China is not really a growth market…have I left anything out?…and not believe that AAPL can dominate the tablet market for years to come, that China represents a huge opportunity for the company, that AAPL can continue to grow its top and bottom line much faster than its size would indicate (because it is a small player in HUGE markets) smacks of negativity unlike I have ever seen with a company this successful.
I have been down this road with AAPL before. I was one of the few who believed that AAPL would continue to execute when the economy tanked in 2008-09. Everyone dumped the stock and it eventually settled at $80 before everyone suddenly seemed to understand that Apple was indeed perhaps the only consumer goods company that grew revenues during that time. It was a phenomenal accomplishment and it was sweet payback to all those who predicted that the iPhone would flop. I am prepared to go down that road again if I have to because I believe that the AAPL story is far from over.
Really? table shows QUARTERLY earning to be $5.39 billion. That’s the yearly figure. Proof read much?
The table refers to revenue, not to earnings. I
f i sell goods for $1000 and my cost for the goods was $800, then my balance sheet shows $1000 in revenue and $200 in earnings – not $1000 in earnings.