Apple’s iPhone Sales and Outlook Fall Short, Shares Slide

Competition remains fierce between Apple Inc and Samsung Electronics as Apple shares fell 8 percent on Monday. The technology empire missed its mark over the holiday season with iPhone sales not meeting anticipated projections. Apple estimated sales to be within $42 to $44 billion this quarter where investors hope for fast monetary gain following the recently struck agreement with China Mobile Ltd, China’s principal carrier, to retail iPhones. The forecast falls short of Wall Street’s expected $46 billion.
The curtailed revenue announcement is a troubling sign, as the March quarter is important given that it covers the initial launch of the China Mobile deal. Analyst at Morningstar, Inc., Brian Colello, said on the subject: “The report for the December quarter was fine, but the real problem is the forecast for the March quarter. The revenue certainly appears to be a shortfall.”
Despite going over expected sales in the first fiscal quarter in December, Chief Financial Officer Peter Oppenheimer reported to analysts that negative influences from currency rates with a stronger U.S. dollar mirrors the reduced revenue report for March. JMP Securities’ Alex Gauna summed up the situation best by saying: “After showing modest signs of improvement, we’re back to a no-growth outlook. It’s something Apple needs to find an answer to. If it can’t prove that it’s going to be a growth story again, the valuation is too high.”
In the end, long term investors continue to count on Apple’s track record of producing revolutionary technologies.

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