CHART OF THE DAY: Apple's REAL Earnings Expectations

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Apple is known for dramatically lowballing its profit guidance, and then miraculously blowing out “expectations.”

Since Sept. 2006, Apple has topped its quarterly EPS guidance by an average 39%, and its revenue guidance by an average 7%.

So what does that mean for this quarter, which will be reported Tuesday afternoon? (Join us for LIVE coverage.)

It’s hard to tell, because Apple significantly changed its accounting practices last quarter.  It now recognises iPhone revenue almost all at once, instead of spreading it over 24 months. So we won’t know for a few quarters just how much Apple is lowballing its guidance using the new numbers.

But running the old formula, based on Apple’s midpoint March quarter guidance of $2.12 EPS and $11.20 billion in sales, history suggests Apple should report EPS of about $2.95 on $11.98 billion of revenue.

Wall Street expects lower earnings but even higher revenue: Consensus stands at $2.44 of EPS on $12.06 billion of revenue.  So Apple is set up to once again “surprise” on earnings, but, possibly, disappoint on revenue.

SAI Chart Apple earnings March 2010

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