Here is what a bad quarter looks like at Apple: revenue up 40 per cent – $8bn higher than a year ago – and net income up 50 per cent. If the rest of the human race could learn to fail like this, it would soon abolish war and colonise distant galaxies.
Nonetheless, both sales and profits were a few per cent lower than what Wall Street had pencilled in and stock prices react to performance relative to expectations. Apple’s shares moved down 6 per cent in late trading, leaving the company trading at 11 times trailing earnings, once the getting-to-be-embarrassing $87 of cash per share is backed out.
The miss, if it must be described that way, was driven almost entirely by surprisingly low iPhone sales of 17m units; analysts were looking for two or three million more. This can be neatly explained as a one-off, as customers delayed buying while they waited for version 4s to roll out after the quarter ended. Management made this point and expressed great confidence that there would be record iPhone sales in the next quarter – more, that is to say, than the 20m sold in the June quarter.