BII Express: Apple Earnings Preview

Apple Earnings Preview
Apple earnings are an expectations game, and the expectations are sky-high. Apple CEO Tim Cook himself predicted a record holiday quarter for Apple after delivering a disappointing September quarter (his first as CEO). 

The fastest-growing and most important part of Apple’s business is its iOS devices business, the iPhone and iPad. Analysts want to know how many iPhones and iPads Apple sold last quarter; in particular, this will be the first quarter when Apple will reveal sales of the new iPhone 4S — analyst expectations are around 33 million iPhones and 12-13 million iPads, according to BGC Partners analyst Colin W. Gillis.

On the income front, the Street’s expectation is $10.07 EPS, and $38.76 billion. By way of comparison, as SAI’s Jay Yarow points out, Apple’s “real” earnings expectations, obtained by comparing Apple’s historical earnings to its usually-comically-low guidance, are of $12.86 in EPS, and $42.9 billion in revenue.

We will have coverage of Apple’s earnings once they come out after the close. We believe Apple is likely to come out in line with analyst estimates, as iOS growth stabilizes and analysts come to grips with Apple’s top-notch execution →

In other news…

The details are out on Gilt Groupe’s cuts: 90 employees or 10% of staff, mostly in the daily deals, full-priced men’s clothing and gourmet food businesses. This looks like more of a readjustment than a drastic setback, and we remain bullish on the flash sales market (while anticipating a shakeout this year). Click here for our report on the flash sales market →

Social media site Tumblr revealed some very impressive stats: 100+ million uniques per month and 15+ billion pageviews per month. Tumblr is proof that social is not “over” and that there can be many more outstanding social success stories after Facebook. Another one is Pinterest, which we wrote about here →

Twitter acquires Dasient, a spam-fighting startup. This is a talent acquisition to fight the stubbornly persistent problem of spam on Twitter. Don’t miss our special report on Twitter’s business, here →

Magazine company Meredith Corp is buying AllRecipes, the biggest recipes site, from Reader’s Digest, according to a report by AllThingsD’s Peter Kafka. The price could be in the $200 million range. Don’t believe anyone who tells you content isn’t a good business.

Yahoo is close to completing a deal for Yahoo! Japan and is making progress towards an Alibaba deal, sources tell SAI. They also indicate that Yahoo is expected to wind up with $5 billion worth of new businesses as part of the deals and that further board shakeups are planned in the future.

YouTube is streaming 4 billion online videos a day, up 25% from last May. Viewers are increasingly accessing the site’s videos away from the personal computer — on smartphones, tablets, and even televisions. YouTube is currently making a big push to upgrade its content, recently redesigning the site to promote channels organised around specific themes.