Has Apple screwed up that badly?

The one-time Wall Street darling has become a dog, and it could be headed for its first quarterly profit decline in more than a decade.

By Jonathan Berr Jan 22, 2013 4:38PM
Apple (AAPL) has become the tech world's answer to the Keystone Kops. One financial blogger even likened the volatile stock Tuesday to a "psycho ex-girlfriend."

Nothing Cupertino does lately is good enough for the company's rabid fans in Silicon Valley and on Wall Street. And Wednesday, we may see some naysayer predictions become a reality.

The maker of the iPad, iPhone and MacBook is scheduled to report earnings Wednesday, and as Bloomberg News pointed out, the company may show its first quarterly profit decline in more than a decade.  
There are many reasons for the decline, including rising competition from Samsung and pricier components. And sales -- while still at a level any other company would drool over -- are slowing. Revenue is only expected to rise 18% to $54.8 billion, the slowest rate since 2009.

Shares of Apple have plunged more than 20% over the past three months as investors fretted about calamities real (the popularity of Android) and imagined (the iPad Mini supposedly falling flat in China). The problem that stock market pundits have with Apple is that since they weren't too good at forecasting the good times, they're worried about missing the boat in the "bad times."The Apple Inc. logo is displayed on the back of the new MacBook Pro David Paul Morris/Bloomberg via Getty Images   

The company has exceeded analysts' predictions in all but three quarters since 2006, creating expectations high enough for the International Space Station. Apple's fetish for secrecy that began under the late CEO Steve Jobs creates an aura of mystery that magnifies the importance of everything the company does. In good times, there was a sense of excitement over every new product launch. In not-so-good times, investors looking for explicit reassurances are losing faith. 

Apple has hit many home runs over the years, so many in fact that if it only manages a single or a double, many are left disappointed. Will that be the case on Wednesday?

--Jonathan Berr does not own shares of the listed stocks.  Follow him on Twitter @jdberr. 

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Tags: AAPL
11Comments
Jan 22, 2013 4:48PM
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We don`t move the stock prices.It`s the hedge fund managers that book profits.
Jan 22, 2013 6:08PM
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You are right about the hedge funds crowd these last couple of month's Screams ... of someone leaky mis- infromation about Apple ......someone is on the take...... without a doubt in my mind  i am not usually wanting the government involved in any aspect of my life but this needs to be investgaged no question on my mind they have gone in 6 months from the as the anylast have said the best run company in the word to a drege on the market not to mention my pocketbook some has stolen my money who are they as usual hey will walk away with millions upon millions
Jan 22, 2013 5:49PM
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Yes, I also say "screw Wall Street'.  What do these idiot analyst, so they call themselves, think that any company can keep their stock going up. All companies pull in a bit here and there. If they don't it's because Wall Street crooks are manipulating the price / market.

 

Apple, don't listen to Wall Street. Just keep doing what your doing by inventing and do spend on R&D.

Jan 23, 2013 12:08PM
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History is repeating itself: Apple produces brilliant concepts and than stops innovating and the competition catches up and passes them.  Without Steve Job's brilliance Apple is done.  How stupid was it to sue your major supplier and ally (samsung)? 

They are about to lose the tablet market to Microsoft and Intel.  Maybe the Surface Pro is too expensive and has less than ideal battery life today but in two years those Wintel tablets will be dirt cheap with battery life to spare and integrates with the office network. 

It's all downhill from here on out for Apple.  Sell now while before the bottom drops out...

Jan 22, 2013 7:16PM
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Maybe it's Apple that needs to go private, not Dell. It's almost always beneficial for an organization to stay away from Wall Street. 
Jan 23, 2013 8:53AM
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People and the markets are idiots. If Apple's profits were cut in half the stock would still be undervalued. Why is no other tech company held to the crazy expectations people have for apple?
Jan 22, 2013 11:44PM
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I guess the only thing really sad about Apple; Is we have never owned their stock, at least not directly.

Woe be to us...

Jan 22, 2013 5:34PM
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Screw Wall Street!!  Apple is a great company, makes good products, provides good jobs to many thousands of people, and has returned huge returns to investors. it can't be expected to hit home runs all the time. Not even Steve Jobs could have done that. If Apple is a dog, Wall Street is dog poop. 
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