Instant View: Apple's quarterly sales fail to excite investors

Reuters

SAN FRANCISCO (Reuters) - Apple Inc's quarterly revenue barely beat Wall Street's heightened expectations after it sold a solid 33.8 million iPhones in the September quarter, but gross margins and profit slid, disappointing some investors. Shares in the company were down more than 2 percent after hours. Commentary: SHANNON CROSS, CROSS RESEARCH "They guided for a solid quarter and it came in a little bit above where they guided. The upside looks like more aggressive share-repurchase and better iPhone numbers than people were expecting. "They're guiding for another solid quarter and indicating that they're going to continue along their path of aggressively returning cash, although not as aggressively as (Carl) Icahn might like. "Clearly the iPhone is doing very well at 33 million sold. There was a point in time when people were talking about this quarter as potentially really low for iPhone units, but now the basic consensus on the street is the iPhone is still doing well. "Their operating expense is up a bit more than I anticipated. They're going to be very aggressive in terms of their marketing. "They had already preannounced and people got euphoric in recent weeks. It wasn't a massive blowout. They're taking a much more pragmatic, rational guidance these days." DANIEL ERNST, ANALYST, HUDSON SQUARE RESEARCH On why Apple's stock fell following the report: "Irrational expectations on part of over-exuberant analysts trying to have the high number." SHEBLY SEYRAFI, ANALYST, FBN SECURITIES "The Mac revenue was on the light side and it was negatively impacted by a sharp decline in the blended ASPs. "My view is they were going to take an iPad hit in front of the new cycle. That was to be expected. I don't think they terribly 'upsided' the gross margin as much as some people would have wanted." BRIAN COLELLO, ANALYST, MORNINGSTAR "All eyes are on guidance. "With Apple focusing on premium products, maintaining their pricing, ignoring calls for a low-cost iPhone in China, I think we would have expected higher gross margins. "With the higher-price phones and clear preference toward the 5S, we were all expecting more of a gross margin boost for the December quarter." (Reporting by Noel Randewich and Gerry Shih)