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AAPL Launching After Huge Quarter
The Dow Jones and S&P 500 are off in early trading as investors cool and Roubini talks of global recession. The NASDAQ, however, is up as shares of AAPL soar up nearly 9% on rocketing earnings. Investors will continue to be focused on iPhone adoption; update to the iPad; market share growth of the Mac business; further penetration in China and emerging markets; the evolution and potential re-conception of Apple TV; and platforms such as Siri, iAd, iBooks and social (Ping). Shares of Apple trade at 7.3x Enterprise Value / Trailing Twelve Months Free Cash Flow (including long-term marketable securities). Not for long. Check out Business Insider’s Apple model, complete with charts and graphs, here.Everything You Need To Know About Last Night’s Earnings (Business Insider)
Here we go:
- Apple Delivers Blowout Earnings: Apple had a monster blowout quarter, beating expectations across the board. The biggest number is that the company sold 37 million iPhones, easily beating the Street’s whisper number of 34 million. And 15.4 million iPads sold, which clobbers the 13 million expectation.
- The iPhone Company: In a breakdown of Apple’s sales by product category, it’s an iPhone company now, with 53% of sales coming from the smartphone.
- Take That Samsung: Remember when Samsung said it shipped 35 million smartphones in the holiday quarter? Well, Apple is back with 37 million iPhones sold. That likely makes Apple the number one smartphone manufacturer on the planet.
- Apple’s Profit Higher Than Google’s Revenue: Apple earned $13.1 billion in income in the latest quarter, higher than Google’s $10.6 billion in revenue during the same quarter. Stunning.
- What Kindle Fire? Apple blew away analyst expectations for iPad sales last quarter despite the introduction of the Kindle Fire. Tim Cook checked iPad sales in the U.S. on a weekly basis after the launch of the Fire, but saw nothing.
- iPads Outselling PCs: iPads outsold desktop PCs (based on IDC figures) this last quarter. That’s a stunning development. Computing has gone totally mobile, and while Windows still ships on most of the portable PCs in the world, the iPad is coming up incredibly fast.
- Shares Explode To All Time High: Shares of Apple spiked to an all-time high during after-hours trading last night, up more than 9%. Apple’s market cap is at ~$422.39 billion, while Exxon is currently at ~$418.53 billion.
Not. Too. Shabby.
Wall Street Drools Over Apple’s Insane Quarter (Various)
The pros weigh in:
- Piper Jaffray: Gene Munster says Apple remains his top pick this year. It is simultaneously a market expansion story as well as an upgrade cycle story. The true force of the December quarter will be felt throughout 2012. iPhone re-buy rates could be as high as 94%, setting up a monster iPhone 5 upgrade (which he expects in August) as well as the iPad 3 launch (expected in April) will be another source of upside. He reiterates his Overweight rating and $607 price-target.
- Morgan Stanley: Katy Huberty thinks that Apple reported the cleanest and strongest EPS beat in recent history. The iPad 3 and iPhone 5 launches will help maintain sales momentum in 2012 and increasing possibility of cash return could re-rate the stock toward IBM’s multiple range of 12-13x. She maintains her Overweight rating and is raising her price-target to $515.
- Barclays Capital: Ben Reitzes says there is no law of large numbers here. He thinks momentum can continue given low channel inventories and demand in China and several new product cycles this calendar year. He believes we may hear more around a potential dividend and Apple’s entry into the TV business this year as well. With all of these drivers, Apple remains, his top pick. Reiterate Overweight rating and $630 price-target.
- UBS: Maynard Um expects the iPhone to drive into the March quarter as supply / demand remains imbalanced with continued international roll-outs. He thinks iPad strength was encouraging in the face of lower cost competition, and an impending iPad 3 launch should enable Apple to continue to drive growth and maintain share. These trends set Apple up nicely for 2012. He maintains his Buy rating and is raising his price-target to $550.
2012 should be interesting.
Do you think Apple is intentionally understating its second fiscal quarter revenue forecast of $32 billion? (Scoople)
Don’t they always sandbag guidance?
And Just Like That, Apple Overtakes Google’s Android (Reuters)
Booming demand for the iPhone 4S helped Apple beat all phones using Google’s Android platform in the U.S. smartphone market in the fourth quarter. Research firm Kantar Worldpanel ComTech says that Apple’s share of the U.S. market doubled from a year ago to 44.9% in the most recent quarter (December), just beating Google’s Android smartphones, which slipped to 44.8% from 50%. Considering iPhone’s share of the market was dead in the water for months as Android made a monster run this is really impressive.
Key Takeaways From Apple’s Earnings (Business Insider Intelligence)
What to deduce from these hard-to-fathom numbers:
- Apple is now an iOS company
- We are in a post-PC era, and Apple embodies that
- The power of brand is an amazing thing
- Superb execution
- Google’s network effect has to wait
- Android / Kindle and the like aren’t denting Apple’s growth
Click here to learn more about Business Insider Intelligence.
More And More Users Switching To The iOS Platform (AppleInsider)
That’s going to be a great halo effect. A new survey of recent iPhone customers from Consumer Intelligence Research Partners (CIRP) found that 21% of iPhone 4S buyers chose Apple’s highest capacity 64-gigabyte model, while 36% of users migrated from another platform like Android, BlackBerry or Palm. CIRP, in a previous study, found that 18% of iPhone buyers at the iPhone 4S launch were switching from other platforms. That number only grew through the holidays.
Apple Sold 350K Textbooks In First Three Days (All Things Digital)
According to Global Equities Research, which monitors Apple’s iBook sales via a proprietary tracking system it doesn’t much care to discuss, more than 350,000 textbooks were downloaded from the company’s iBooks Store within the first three days of availability. That seems to be off to a good start. Add to this the lower cost of iBook production and a system under which textbooks are sold directly to students, and the maths here starts to looks pretty good. Do you think emulating real-world page-turning experience will boost iBooks adoption?
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