Linked List: January 23, 2013

Wednesday, 23 January 2013

No Guidance for Earnings Next Quarter ★

Brian Chaffin, writing at The Mac Observer, points to some actual disappointing news in Apple’s results today:

Accordingly, Apple offered guidance of revenue between $41 and $43 billion. Consensus estimates for revenue were sitting at 45.4 billion. In the old days, Apple’s guidance of $41-$43 billion would have been perceived as being roughly in line with that consensus number, but in the new era of a “we’re not sandbagging” Apple, that represents a guidance miss. […]

Notably — and this could also be having an after-hours affect on $AAPL — Apple didn’t offer guidance for earnings.

I wonder about the lack of guidance on earnings too. Revenue growth was just fine for the just-reported quarter — it’s earnings that disappointed. Update: Apple didn’t mention earnings, but given the numbers they did provide, you can work it out, and it’s a drop.

Dan Lyons on Apple’s Quarter ★

I wanted an Apple bear’s take on today’s results and the market reaction. I think Dan Lyon’s piece for ReadWrite was actually pretty reasonable. No hysterics, no grave dancing. But it kind of falls apart at the end:

Still, it seems Apple has hit a wall. It’s not just about sales and earnings, but also about innovation. It’s been years since Apple did something truly revolutionary. Rumors of Apple getting into the TV market continue to swirl, but so far it’s all just rumors.

iPod, iPhone, iPad. That’s the sort of Big New Thing that Lyons — and many others — are talking about. Only Steve Jobs could do those things, Tim Cook can’t. But look at the timeframe: iPod 2001, iPhone 2007, iPad 2010. Even during the era of innovation Lyons is pointing to, Apple spent six years between the first iPod and first iPhone. Again, why is it only Apple that’s expected to invent a time machine?

(Worth pointing out too, that Lyons didn’t see the original iPad as a breakthrough: “Jobs and his team kept using words like ‘breakthrough’ and ‘magical’, but the iPad is neither, at least not right now.”)

Bad News: Apple Is the Most Profitable Company in History ★

Mike Beasley, 9to5 Mac:

Apple today posted its earnings for the final quarter of 2012, which was “disappointingly” the largest corporate earnings year in human history by a tidy margin, causing many investors to panic as Apple clearly circles the drain in what will be the first step in a short road to the demise of the most valuable company in the world (If Exxon hasn’t indeed surpassed it tomorrow morning).

Apple’s 13.1B in earnings this quarter was the 4th largest of all time according to the same metric.

Exxon previously held the top three spots for annual profit. So, to reiterate, Apple just reported the most profitable year of any company ever, the fourth-most profitable quarter of any company ever, and the stock tanked after hours.

After Hours ★

After reporting record-breaking revenue, profit, and iOS device sales, Apple’s stock is down over 10 percent in after-hours trading (which is often more volatile than regular trading), which makes sense because, uh…, because after hours investors are a bunch of idiots? I give up.

For perspective on how much 10 percent of Apple’s market value is, Tom Gara tweets:

Apple’s market value has fallen by the combined market value of two Nokias plus two RIMs in the hours since its results came out.

Apple ‘A Broken Company’ ★

Bruno J. Navarro, CNBC:

Apple stock is headed to a level of $425 per share this quarter, DoubleLine CEO Jeff Gundlach said after the company reported disappointing earnings Wednesday.

“I think this is really a broken company that is over-owned,” he said on “Fast Money.”

Record-breaking revenue. Record-breaking profit. Over 75 million iOS devices sold in the quarter. Totally broken.

Apple Q1 2013 Quarterly Results ★

Apple:

Apple today announced financial results for its 13-week fiscal 2013 first quarter ended December 29, 2012. The Company posted record quarterly revenue of $54.5 billion and record 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, in the 14-week year-ago quarter. Gross margin was 38.6 percent compared to 44.7 percent in the year-ago quarter.

Average weekly revenue was $4.2 billion in the quarter compared to $3.3 billion in the year-ago quarter.

Records all around. But even accounting for the 13- vs. 14-week quarters, profit growth has slowed considerably. That said, it was just three years ago that Steve Jobs boasted that Apple had become a $50 billion company in annual revenue. Now they just reported $54.5 billion in quarterly revenue.

The Company sold a record 47.8 million iPhones in the quarter, compared to 37 million in the year-ago quarter. Apple also sold a record 22.9 million iPads during the quarter, compared to 15.4 million in the year-ago quarter. The Company sold 4.1 million Macs, compared to 5.2 million in the year-ago quarter. Apple sold 12.7 million iPods in the quarter, compared to 15.4 million in the year-ago quarter.

That’s a significant drop for Mac sales. Part of that might be that the new iMacs weren’t available until December, but I think it’s more about the post-PC transition. Cars are in, trucks are out.

‘I’m Sure You Realize the Asymmetry in the Financial Resources of Our Respective Companies’ ★

That’s from a stone cold 2007 email from Steve Jobs to then-CEO of Palm Ed Colligan, regarding Palm’s recruiting of Apple employees to work on what became the Pre and WebOS. The man did not beat around the bush. Could be legal trouble for Apple (and a bunch of other companies), though.

‘Can Siri Go Deaf, Mute, and Blind?’ ★

Kontra:

What happens to Apple’s design advantage in an age of objects performing simple discreet tasks or “intuiting” and brokering our next command among themselves without the need for our touch or gaze? Indeed, what happens to UI design, in general, in an ocean of “interface-less” objects inter-networked ubiquitously?

Form Follows Function ★

Amazing HTML5 experience demos by Jongmin Kim.

‘What It’s Really Like Working With Steve Jobs’ ★

Glenn Reid, who helped design iMovie and iPhoto, in a year-ago remembrance:

Not only did he know and love product engineering, it’s all he really wanted to do. He told me once that part of the reason he wanted to be CEO was so that nobody could tell him that he wasn’t allowed to participate in the nitty-gritty of product design. […]

Steve’s magic recipe was that he was a product designer at his core, who was smart enough to know that the best way to design products was to have the magic wand of CEO in one of your hands.

If he knew he was right, he didn’t have to explain or justify a decision. A designer with carte blanche.