Firm lost over £50 billion in market price in after hours trading last night after Wall Street's predictions for the business were not met
Apple has seen its shares drop since it reported disappointing earnings in its fiscal first quarter yesterday, and warned of a slow down in sales overall in the second quarter.
The firm lost over £50 billion in market price in after hours trading last night after Wall Street's predictions for the business were not met for the period ended 29 December, and analysts and investors were left feeling concerned for the future growth of the business.
Analysts expected Apple to hit around $55 billion in sales with earnings of $13.48 per share, despite Apple's warning last October that it had cut expectations to £52 billion, with earnings of $11.75. Apple posted quarterly revenue for the first fiscal quarter of $54.5 billion and quarterly net profit of $13.1 billion, or $13.81 per diluted share.
These results compare to revenue of $46.3 billion and net profit of $13.1 billion, or $13.87 per diluted share, for the same period last year.
Apple warned in October 2012 that sales would come under pressure over the next few months due to the onslaught of product launches, supply and demand issues, and the fact that the iPad Mini and iPhone 5 are both less profitable than their older, larger predecessors. Because of this, it stated at the time that first quarter sales would not be as high as predicted. Since September last year, its stock has subsequently fallen by around one quarter.
Apple said it sold a 47.8 million iPhones in the quarter, compared to 37 million in the same period 2012. Apple also sold 22.9 million iPads during the quarter, compared to 15.4 million one year ago. The company sold 4.1 million Macs, compared to 5.2 million in the first quarter 2012, and 12.7 million iPods in this quarter, compared to 15.4 million one year ago.
Gross margin was 38.6% compared to 44.7% for the same quarter last year. International sales accounted for 61% of the quarter's revenue.
Additionally, average weekly revenue was $4.2 billion in the quarter compared to $3.3 billion one year ago.
Apple also warned that second quarter sales would slow drastically, hitting revenue of between $41 billion and $43 billion.
Smart Chimps thinks: Everyone always has had high expectations of innovative Apple, from the time it launched its first mobile phone and gave us the smartphone market we see today, to the time it came up with the tablet. Now things seem a little rocky; launching masses of products together rather than one at a time as it has in previous years seems to have caused issues, plus a general lack of innovation in its designs over the last year have been disappointing. OK, so one tablet got smaller, but that is a copy of what Apple's competitors have already come out with. And not forgetting the Apple Maps debacle, which was the start of the share slump back in September 2012. Apple has a lot to try and work out in 2013. It doesn't look like its second quarter will be much better, but we will have to wait and see.