A lot of the dip in iPhone 4 sales can be attributed to the Osborne effect. People were so excited to get their hands on the next model of the iPhone that they didn't buy the current model.

Now that 4s is out, sales are right back where we'd expect them.

BKITU: Huh. I thought eliminating jobs usually helped the bottom line.

We have a WINNAR!

Maybe Apple should invest in US based advanced manufacturing facilities instead of a space ship to honor Xenu.

Even after a 7% drop, AAPL still has a higher market cap than XON. Seven percent is barely a price correction.

I still don't understand this whole idea of analyst's expatiations

Ender's: F*ck those corporate shills. Let them all fail, I say.

Apple aren't "corporate shills". They're just...corporate. I mean, a shill is a person who advocates for something without disclosing his relationship to that something. Apple doesn't pretend to not be a corporation to help out the idea of corporations or anything. That doesn't even make sense.

AverageAmericanGuy: A lot of the dip in iPhone 4 sales can be attributed to the Osborne effect. People were so excited to get their hands on the next model of the iPhone that they didn't buy the current model.

Now that 4s is out, sales are right back where we'd expect them.

Osborne went out of business because it bragged about a new product loooong before it was ready to be released and couldn't survive the dip in sales because it sucked at running its own business. Apple did no such thing. It announced nothing. But the media and technology pundents couldn't stand not printing something their cat told them about Apple that morning. So really - the Osborne effect is not relevant here whatsoever.

zez: I still don't understand this whole idea of analyst's expatiations

expectations

bravian: AverageAmericanGuy: A lot of the dip in iPhone 4 sales can be attributed to the Osborne effect. People were so excited to get their hands on the next model of the iPhone that they didn't buy the current model.

Now that 4s is out, sales are right back where we'd expect them.

Osborne went out of business because it bragged about a new product loooong before it was ready to be released and couldn't survive the dip in sales because it sucked at running its own business. Apple did no such thing. It announced nothing. But the media and technology pundents couldn't stand not printing something their cat told them about Apple that morning. So really - the Osborne effect is not relevant here whatsoever.

Except that Apple was already running betas with selected user groups for such features as Siri, that people knew something new was coming down the pike and so they held off upgrading their phones until the announcement was made.

The announcement isn't the primary determining factor for the Osborne effect. Rather, it is the increase in expectations of a future product that damages sales of the current product. Whether it is an announcement or leaks, the effect is the same - users put off buying and sales suffer.

AverageAmericanGuy: Except that Apple was already running betas with selected user groups for such features as Siri, that it had been a year since the last iPhone release, so people knew something new was coming down the pike and so they held off upgrading their phones until the announcement was made.

FTFY.

/I boldly predict the iPad 3 will be released next spring.

Mad_Radhu: AverageAmericanGuy: Except that Apple was already running betas with selected user groups for such features as Siri, that it had been a year since the last iPhone release, so people knew something new was coming down the pike and so they held off upgrading their phones until the announcement was made.

FTFY.

/I boldly predict the iPad 3 will be released next spring.

Whatever...next you'll be saying it will be thinner with better screen resolution too! You, sir, are living in a fantasy land.

This is exactly what is wrong with the country.

You sell 17 million units of a given product.

You make over 6 billion in profit.

And your stock price DROPS...

-- because some farkwad thought you should've sold 20 million units, and you only made 96% of the profit they figured, also.

fark everybody.

If Apple makes so much money why can't they move their manufacturing to the US instead of farming it out to China?

In two days the stock will go back up. If you got cash, buy now.

Beer Drinking Masturbator: This is exactly what is wrong with the country.

You sell 17 million units of a given product.

You make over 6 billion in profit.

And your stock price DROPS...

-- because some farkwad thought you should've sold 20 million units, and you only made 96% of the profit they figured, also.

fark everybody.

F*cking stock market, how does it work? Investors don't wait until the day you release earnings and then do a quarter's worth of reacting. The stock has been traded over the last quarter based on speculated sales. In other words, the consensus estimates were already priced into the stock. In theory, if the earnings had matched estimates exactly, the stock would've been flat. But since they fell short, it makes sense that the stock would go down. If they had beaten expectations (as AAPL almost always does), the stock would've gone up. It's not rocket science.

oren0: Beer Drinking Masturbator: This is exactly what is wrong with the country.

You sell 17 million units of a given product.

You make over 6 billion in profit.

And your stock price DROPS...

-- because some farkwad thought you should've sold 20 million units, and you only made 96% of the profit they figured, also.

fark everybody.

F*cking stock market, how does it work? Investors don't wait until the day you release earnings and then do a quarter's worth of reacting. The stock has been traded over the last quarter based on speculated sales. In other words, the consensus estimates were already priced into the stock. In theory, if the earnings had matched estimates exactly, the stock would've been flat. But since they fell short, it makes sense that the stock would go down. If they had beaten expectations (as AAPL almost always does), the stock would've gone up. It's not rocket science.

For some people, it is as difficult as rocket science. These people would be better off investing in certificates of deposit than in the stock market.

But they invest in the market, then go sit on a sidewalk in NY and complain about Wall Street screwing them.

oren0: Investors don't wait until the day you release earnings and then do a quarter's worth of reacting

Maybe investors should go back to how it used to be and not worry so much about earnings and this crap about analyst estimates can be thrown out. it hasn't been around long and it sure doesn't help things.

change1211: If Apple makes so much money why can't they move their manufacturing to the US instead of farming it out to China?

Apple doesn't own manufacturing plants.

WhyteRaven74: Maybe investors should go back to how it used to be and not worry so much about earnings and this crap about analyst estimates can be thrown out. it hasn't been around long and it sure doesn't help things.

Intelligent investors always worried about earnings. They also always made estimates about future earnings potential. A stock is only worth the NPV of your expected return on it, and earnings are where those future returns come from. Analyst estimates--well, the ones that aren't trying to predict future changes in the stock price through a pattern of market movements--are supposed to be more informed estimates of future earnings.
.

Nicholas Urfe: ntelligent investors always worried about earnings.

A great many were far more concerned with revenues and other stuff on the balance sheet, like debt equity ratios, R&D funding where applicable and stuff not on the balance sheet, like employee turnover. Pressing a company to jack up its earnings is just begging for it to start cutting corners, which is never a good thing. Far better a few bucks less in earnings to maintain long term stability that short term measures that end up in the long term being a drag on the company.

WhyteRaven74: A great many were far more concerned with revenues and other stuff on the balance sheet, like debt equity ratios, R&D funding where applicable and stuff not on the balance sheet, like employee turnover. Pressing a company to jack up its earnings is just begging for it to start cutting corners, which is never a good thing. Far better a few bucks less in earnings to maintain long term stability that short term measures that end up in the long term being a drag on the company.

Ummm, no. In fact, in the pre-1980 era, earnings were even more important because those earnings were much more likely to be returned to investors (who technically own the per-share stake of those earnings) via dividends. When companies began to retain those earnings, they were, in effect, saying "hey, we can re-invest your money in our company more effectively than you can invest it elsewhere, so let us hang onto it". With companies like Apple, this is/was a great deal when they were growing like mad, but if that growth stops or slows or doesn't hit expectations, investors are going to look at that $100B cash pile earning 0.5% in short-term investments while blowing billions on an edifice to themselves and be a little more skeptical of the implicit deal of Apple reinvesting their earnings effectively.

From about 1996 to 2000, investors stopped worrying about earnings and started looking at things like revenues (which are easily gamed), balance sheets, R&D spending, etc. How did that work out?

AverageAmericanGuy: A lot of the dip in iPhone 4 sales can be attributed to the Osborne effect. People were so excited to get their hands on the next model of the iPhone that they didn't buy the current model.

Now that 4s is out, sales are right back where we'd expect them.

That would explain why he lashed out:

Say what you will about Wall Street, but at least the professionals had some kind of knowledge and standards they apply to valuating stock other than *derp*.

The massive influx of individual investors in the stock market in the last 20 years hasn't really been a good thing. It just means more people are losing money for trying something they suck at.

Apple is raking in $ hand over fist, and somehow their stock price goes DOWN? That makes zero sense. It's just the pikers pretending they understand what's going on and saying "gee derp Jobs is dead and 4s isn't magic derp gotta gets my money into something safe like gold derp"

cefm: That makes zero sense.

So ... speaking of derp... your whole post.

AAPL is up nearly 7% over the last quarter - and the Nasdaq and S&P are down 6.8 and 7.7% respectively in the same time frame. That's a 15% outperformance based on earnings which wound up being overestimated -- and you're confused as to why their price slipped a bit?

Go back to the politics tab.

I dont understand whypeople are getting mad...
a bunch of tards said "herp derp wat?!? SELL SELL!!" knee-jerk reaction!!

If you were alreadying holding, buy more for cheap. Next report will likely be better,
your time horizion on this is probably a year or more so why would you care about a huge decline on one day?

Cash on hand is now over 82 billion...

As a apple investor since 2009, it is HARD to complain, but either do something with that money or give it back. Even if they just bought back a couple billion dollars or so of their stock every quarter their "rainy day" fund would still keep increasing, albiet slower