Tuesday, January 11, 2011

Apple Reports Earnings on Tuesday, January 18 (Charts) *Financial Performance Review* AAPL


Apple reports earnings on Tuesday, January 18

Apple Financial Performance Review

Apple will be reporting quarterly financial results on Tuesday, January 18 after market close and usually just before the earnings conference call. The conference call will be at 2:00 p.m. PT. Apple financial performance charts for prior quarters have been posted on the Apple Financial Performance page and will be updated for this next quarterly report. The charts are:
Apple Performance by the Quarters
Earnings per Share (Diluted) and Cash Flow per Share
Total Revenues, Operating Income, Net Income
Gross Margin, Operating Margin, Net Margin
Return on Assets
Total Revenues and Earnings per Share Growth Rates

In addition, a Bonus Chart has been included below in this post, Apple Revenues by Product. More charts have been posted on the Apple Financial Performance page.

Apple Future and Past Financial Performance

Q4 2010 Analysts' Estimates
Yahoo Finance analysts' estimates for Q4 2010 are:
Total Revenues: $24.17B average, $23.00B low estimate, $25.54B high estimate, 44 analysts
Earnings per Share: $5.31 average, $4.93 low estimate, $5.75 high estimate, 49 analysts

Q4 2010 Apple Outlook
CFO Peter Oppenheimer provided guidance for the Q4 2010 quarter: revenues $23 billion, gross margin 36%, operating expenses $2.325 billion, income tax rate 25.5%, targeting earnings per share at “about” $4.80. Apple usually provides low guidance and beats.

Q3 2010 Financial Results
When Apple reports calendar Q4, the 3 months ended December, financial results on January 14, Apple should hopefully beat various Q3 results. These results are charted on the Apple Financial Performance page. Apple for Q3, the 3 months ended September, financial results were:
Total Revenues $20.343B
Operating Income $5.447B
Net Income $4.308B
Earnings per Share (Diluted) $4.64
Cash Flow per Share $6.12
Gross Profit Margin 36.93%
Operating Income Margin 26.78%
Net Income Margin 21.18%

Apple should easily beat their own Q4 2010 outlook ($4.80 earnings per share). The question is how much higher than $5.00 per share Apple will report. The analysts' average EPS is $5.31, which Apple will probably beat. Apple recorded record Total Revenues of $20.343B and Net Income of $4.308B in Q3 2010. In Q3 2010, Earnings per share were a very high $4.64, but not a record. Cash Flow per Share was a very high $6.12, but lower than Q4 2009 ($6.29).  Q4 2010 is expected to be stellar, as Q4 is typically the best quarter of the year for Apple due to holiday sales. For Q4 2010, Apple should beat Q3 2010 on Total Revenues, Operating Income, Net Income, Earnings per Share, and Cash Flow per Share. It is whether Apple will meet the Q3 Gross Profit Margin (36.93%) that is the main issue for Q4. Gross Profit Margin has declined the past 2 quarters (Q2 & Q3 2010) and so has Operating Income Margin. Net Income Margin increased in Q3. Apple may well miss on Gross Profit Margin, but hopefully not by much. The detailed quarter by quarter charts are on the Apple Financial Performance page.

Apple Bonus Chart!
Apple Performance by the Quarters (Revenues by Product)

Apple Revenues by Product (Chart) Below is a chart of Apple revenues by product: computers, iPods, iTunes Other, iPhone, and iPad. The September 2010 aggregate of these products is an Apple all-time high total revenues ($20.343B). As can be easily seen on the chart, iPhone sales literally exploded in Q3 September 2010. iPhone revenues were 43.3% of total revenues for Q3 2010. Computers comprised about 24% of total revenues in Q3 2010. iPad is third with 13.7% of total revenues and surpassed iTunes Other and iPods in Q3 2010. iTunes Other is 11.7% of total Q3 2010 revenues. The once highly successful iPods (as a proportion of Apple sales) now is last at 7.3% iin Q3 2010. The chart covers the past 8 quarters, from December 2008 through the latest quarter reported, September 2010. More charts have been posted on the Apple Financial Performance page. Recent chart data is:
Quarter, Computers, iPods, iTunes Other, iPhones, iPad
Dec09: $4.4B, $3.4B, $2.3B, $5.6B, $0
Mar10: $3.8B, $1.9B, $2.4B, $5.4B, $0
Jun10: $4.4B, $1.5B, $2.3B, $5.3B, $2.2B
Sep10: $4.9B, $1.5B, $2.4B, $8.8B, $2.8B

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