Apple has reported financial results that missed expectations for the first time in a number of years, disappointing the market. The firm’s shares fell on Wall Street in the wake of the result, despite Apple turning in a staggering 85 per cent increase in profit for the year.
The company posted net profit of $25.9bn for the year ending 25 September 2011, up from the $14bn it recorded over the course of FY10. Apple’s total revenue for the year stood at $108bn, 66 per cent higher than what was generated over 2010.
For 4Q11, Apple posted revenues of $28.27bn and quarterly net profit of $6.62bn, compared with last year’s fourth quarter revenue of $20.34bn and net quarterly profit of $4.31 bn.
However, Wall Street was not impressed, with Apple’s shares falling nearly 5 per cent in after-hours trading.
Angela Eager, research director for enterprise software and application services at TechMarketView, blamed inflated expectations in Wall Street for the negative headlines surrounding Apple’s missed targets, and insists that there are no signs that Apple is losing momentum.
“Contrary to what you might think from scanning most of the headlines, Apple had a great Q4,” she said. “Despite that, its shares dipped by around 6 per cent in after hours trading last night – because it failed to meet street expectations. This smacks more of over excitement than a rational response.”
She added that reasons for the lower than expected shipments included rumours of a new iPhone launch during the period, which dampened iPhone sales. This is despite 4 million units of the handsets being sold in the first three days.
“With a new iPhone out – even if it isn’t the iPhone 5 – and the Christmas period underway, prospects for the new quarter look very strong and Apple has reflected that in its outlook for Q1 when it is forecasting revenue of about $37bn.”
“Our take on these results is that there are no signs that Apple is losing momentum. Its Q4 was impressive and Q1 looks even better now it has the iPhone 4S to take to market. Product releases and quarterly timeframes can’t always coincide.”
Apple also revealed that is holding a private memorial service for employees to celebrate the life of company co-founder and former chief executive Steve Jobs. The service was announced to Apple employees in an email by CEO Tim Cook and is scheduled for Wednesday morning at company headquarters in Cupertino. It will also be webcast to employees worldwide.