Comments on: Updated: Apple Earnings: A Rare Miss, 17 Million iPhones, 11 Million iPads

By: Tom Krazit

Tom Krazit — Wed, 19 Oct 2011 23:23:43 +0000

Because the headline is correct: they missed expectations. I had written, however, that they had missed their own expectations, which was not correct. The concept of beating expectations or missing expectations is always based off the consensus of 30 or so financial analysts, not just for Apple, but for all public companies.

By: Rog

Rog — Wed, 19 Oct 2011 23:04:18 +0000

Why not fix the headline too?

By: Tom Krazit

Tom Krazit — Tue, 18 Oct 2011 22:01:33 +0000

You’re right, in part. It was the third-party numbers that it missed, and I’ll fix that. But it was a product of writing quickly, not linkbait (saying the wrong thing is actually not a good long-term strategy for getting links).

By: Trittorn

Trittorn — Tue, 18 Oct 2011 21:55:33 +0000

“Apple’s long track record of underpromising and overdelivering when it
comes to the earnings guidance it provides to the financial community
seems to have finally reached an end, despite an otherwise strong
quarter.”

The opening line to the article is false and linkbait just like the headline. Apple did actually, and handily, beat it’s own guidance numbers, which most would define as “underpromising and overdelivering”.

By: Tom Krazit

Tom Krazit — Tue, 18 Oct 2011 21:39:10 +0000

Apple has established a long pattern (8+ years) of shattering its own guidance by ridiculous levels in a quarter and then providing extremely conservative financial guidance for the upcoming quarter despite the fact that they know exactly how well they are doing. As a result, financial analysts, who need to estimate corporate earnings in order to advise their clients on how to invest, began raising their estimates beyond Apple’s guidance.

Apple then continued to beat those increased expectations by ridiculous numbers, so financial analysts continued to raise their estimates. It’s part of what has kept Apple’s stock so high over the last two years, the fact that they have continued to beat those sky-high third-party estimates.

The cycle finally caught up with them. No one complained when the financial community’s estimates were so low compared to the actual numbers. A miss is a miss.

It would be nice if Apple provided more honest guidance, but I understand why they are conservative: there’s little downside. It’s a stupid game, but it’s the game public companies have to play. Clearly any other mobile company would kill for their numbers, and any investor who doesn’t look at little harder at Apple’s numbers and momentum and just sells based on the miss has a pretty short-term outlook.

By: BMichaels

BMichaels — Tue, 18 Oct 2011 21:11:55 +0000

This is the kind of miss that Apple’s competitors can only dream of experiencing at the moment.

By: Allen Braun

Allen Braun — Tue, 18 Oct 2011 20:59:29 +0000

This was NOT a “rare miss” by Apple. It was a swing and a miss by analysts. Clearly Apple grew in most if not all respects and its high stock price is indicative of its 38% revenue growth AND increased margins.