Amidst somewhat lower-than-expected sales this past quarter, the American multinational electronics corporation Apple Inc. hopes to reach unprecedented sales with the debut of its latest gadget this week, the new Apple iPad Mini.
Apple anticipates the release of the iPad Mini, fifth overall generation of the iPad line, is just in time for bustling holiday sales. The product starts at $329 and features a 7.9-inch screen, 2.2 inches smaller than the regular iPad. The smaller, lightweight iPad, which can fit in the palm of a hand, includes a powerful A5 chip, FaceTime and iSight cameras as well as thousands of available apps.
The latest Apple product launched at an ideal time, analysts say, to create more rivalry within a competitive electronics market. In an effort to stay ahead of the curve and continue to compete with other electronic leaders such as Samsung, Apple Chief Executive Officer Tim Cook said the company has introduced several new and updated products to the market since mid-October.
The new iPhone, iPad and iPod recently hit the shelves, as well as the updated Mac computer line, which analysts say is Apple’s effort to keep its key position in the electronics arena. The company hopes the innovative products and modifications will help it effectively compete against other successful products, such as Samsung’s Galaxy smartphone.
iPad Sales Need a Boost
Analysts say new and improved products are just what Apple needs to strengthen its earnings for the next quarter. While revenue hit the mark for the fourth quarter (Q4) ending September 29, EPS (earnings per share) was slightly less than expected.
Although Apple reported nearly $36 billion in sales and generated $8.2 billion in profit for the past quarter, earnings were less than anticipated by Wall Street. While Apple conservatively estimated $7.05 per share, Wall Street predicted $8.75 per share. In reality, it finished in between the two estimates at $8.67.
Wall Street’s forecast had been already been reduced a bit when the company revealed iPad sales for the quarter were lighter than originally expected. Analysts originally anticipated Apple would sell at least 17.5 million iPads for the quarter. When Apple announced 100 million iPads were already sold since the product was first introduced to the market, the quarterly projection was reworked to 15 million. In the end, Apple sold only 14 million for the quarter.
It’s conceivable the rumors about the new iPad mini product making an October debut affected sales for the iPad as Apple customers may have been holding out for the new electronic.
Other Product Sales Also Lagging
Mac sales were also slightly lower than expected at the end of the quarter: 4.9 million sold versus an expected 5 million. The iPod, which analysts predicted would reach at least 5.5 million in sales, came in at 5.3 million.
In contrast, iPhone sales were higher than analysts predicted. iPhone sales reached 26.9 million, surpassing the expected 25.3 million mark.
While earnings fell somewhat short in the last quarter, Apple is projecting a very strong Christmas quarter, especially with the launch of the new iPad Mini. The company forecasts around $52 billion in sales, which is 12 percent higher than the holiday quarter in 2011. If successful, this would be the highest quarterly sales reported by a tech company.
According to a Bloomberg report, analyst Shaw Wusaid he believes Apple will have a big end-of-year quarter, as well as a big first quarter in 2013, but he wonders what will happen after that.
Bill “No Pay” Fay has lived a meager financial existence his entire life. He started writing/bragging about it in 2012, helping birth Debt.org into existence as the site’s original “Frugal Man.” Prior to that, he spent more than 30 years covering the high finance world of college and professional sports for major publications, including the Associated Press, New York Times and Sports Illustrated. His interest in sports has waned some, but he is as passionate as ever about not reaching for his wallet. Bill can be reached at [email protected].
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