Why Apple Shares Got Hammered

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Apple (NASDAQ: AAPL  ) have gotten hammered today, down by as much as 12% after the company reported worse-than-expected earnings driven by light iPhone sales.

So what: The company reported record results in revenue of $54.5 billion and net income of $13.1 billion, or $13.81 per share. iPhone units were less than analysts were expecting, amounting to 47.8 million, although iPad units were in line with forecasts at 22.9 million.

Now what: Investors are also concerned about the company's guidance, which calls for revenue in the current quarter of $41 billion to $43 billion, while the Street was expecting $45 billion. CFO Peter Oppenheimer's comments were interpreted as meaning Apple would be more realistic with its guidance, a shift from its previously conservative outlooks. Mac units were also weak due to significant supply constraints on the new iMacs.

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