Results for Q3 after hours and they disappointed the market

Hey Apple indeed! Results for Q3 after hours and they disappointed the market. I guess the company tees itself up every single time for this type of disappointment, because so much is expected. In normal trade the stock reached an all time high of 319 Dollars, after hours the stock is down at 298.5, over six percent lower.



The reasons? Well, an earnings miss for starters, or did they? It is so tough to read this company. Their products have a coolness that only the first team rugby captain had. The others are like the under 14 B tighthead prop. 4.64 bucks worth of earnings a share for the quarter, that is up from 2.77 bucks this time last year. Sales up a whopping 67 percent to 20.3 billion for the quarter.



Apple managed to sell 14.1 million iPhones in the quarter, the smarts out there had estimated 2 million less than that being sold. And iPads, they managed to sell 4.2 million units. Both of those are quarterly records. Obviously the iPad is new, so the run rate will have to be maintained. Gartner reckons that 19.4 iPad's will be sold this year. And perhaps 28 million next year.




I guess most of the disappointment actually comes from the fact that Apple failed to sell as many iPads, not because they couldn't, but rather because there were supply problems. Which sounds like a good problem to have, although one wants to get that sorted ASAP.


A lot of the talk of the town was actually that Steve Jobs appeared on the conference call. The nerds were going nutty. Jobs said: "I don't usually participate in earnings calls since you're all in such capable hands. But I couldn't help dropping by for our first $20 billion quarter." Show off!!



This is amazing. Read the Apple CEO Discusses F4Q10 Results - Earnings Call Transcript and tell me that Steve Jobs does NOT have an attitude that his product is vastly superior to that of the competition.



When Steve Jobs was talking about their iPhone units shipped: "...it handily beat RIM's 12.1 million Blackberry's sold in their most recent quarter ending in August. We've now passed RIM, and I don't seem them catching up with us in the foreseeable future. They must move beyond their area of strength and comfort into the unfamiliar territory of trying to become a software platform company.

I think it's going to be a challenge for them to create a competitive platform and to convince developers to create apps for yet a third software platform after iOS and Android. With 300,000 apps on Apple's App Store, RIM has a high mountain ahead of them to climb."


Meaow!!! Still, he makes the point that the android platform is just an operating system: "They reported that they had to contend with more than 100 different versions of Android software on 244 different handsets. The multiple hardware and software iterations present developers with a daunting challenge." And that there will be ".... at least four app stores on Android, which customers must search among to find the app they want and developers will need to work with to distribute their apps and get paid."



So he dissed all of his competitors and trumpeted his product. You would expect that from a very arrogant or confident person, or both. Either way he has made shareholders good money. The pot of cash that they sit on will be used to make a power acquisition, we are led to believe. We continue to buy the shares, and I tell you that I am pretty thrilled with the fall off in the price, because if something you like gets cheaper, then you should buy more of them .



Back to the normal market action. Session end the Dow Jones closed at 11143, up 80 points, whilst the nerds of NASDAQ grabbed 11.9 to end up at 2480. The broader market S&P 500 closed up shop at 1184, up 8 and a half point on the day. Basic materials were lower, but on balance all other majors were higher, with financials leading the charge, thanks to Citi.