Please ensure Javascript is enabled for purposes of website accessibility

Apple Inc.'s Earnings: Let's Talk Numbers!

By Motley Fool Staff - Feb 2, 2016 at 7:39AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Revenue, net income, and this other key metric tell the tale of Wall Street’s reaction to the tech giant’s most recent earnings release.

Last week, Apple (AAPL 1.38%) released year-end data that failed to live up to Wall Street's expectations.

In this video segment, Sean O'Reilly and Dylan Lewis go over the numbers for revenue, earnings, and iPhone sales; how Apple's results compared with its guidance; and why Wall Street is so unhappy about it.

A transcript follows the video.


This podcast was recorded on Jan. 29, 2016.

Sean O'Reilly: So, diving in. We're going to do Apple first?

Dylan Lewis: All right. Let's do Apple first.

O'Reilly: Sound good? How did they do? Big numbers.

Lewis: Big numbers. Revenue came in at $75.8 billion, within guidance but below analyst estimates.

O'Reilly: Dylan, say it with a little bit of respect. Seventy-five! I'm just kidding. It's fine.

Lewis: Earnings clocked in at $3.28 per share, beating analyst expectations of $3.23 per share. Obviously, the third big number that most people are looking at when it comes to Apple's earnings are iPhone sales.

O'Reilly: It's really the only number.

Lewis: Yeah, given that it's two-thirds of their revenue base. iPhone sales were 74.8 million units for the quarter, which was up 300,000 units over the previous year.

O'Reilly: That's not a lot. I mean... I'm not looking at a percentage, but that's not a lot (laughs).

Lewis: Yeah. You're not used to seeing increases...

O'Reilly: Hundreds of thousands. What?

Lewis: Increases of less than a million, right? And I think that was probably part of the problem, really. I just mentioned it's two-thirds of their revenue base.

O'Reilly: 300,000 is an apartment complex in China. Like... (laughs)

Lewis: (laughs) Yeah.

O'Reilly: What is this?

Lewis: A city, even. So, despite guidance that they'd laid out in the previous quarter that had said there would be segment growth, obviously, investors were a little worried coming into the report. There have been some bearish signals from Apple suppliers, notably Taiwan Semiconductor, which is something we talked about before on the show, little while back.

So, a lot of people worried about iPhone growth and what general revenue growth would look like. Those concerns are obviously somewhat valid. The company did demonstrate growth, which you like to see. It was not up to the Street's expectations, which is why you see some of the dip you've seen in the market recently.

O'Reilly: But, Dylan, they beat on earnings-per-share estimates!

Lewis: Yeah, that's kind of perennially the Apple problem. They lay out really solid guidance that at least shows some sort of growth, except for this upcoming quarter -- which is something we can get into -- but the Street always wants more.

Dylan Lewis has no position in any stocks mentioned. Sean O'Reilly has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Apple Inc. Stock Quote
Apple Inc.
$167.20 (1.38%) $2.28

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/10/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.