Earnings: Apple Turns In Record Year, Beats Earnings Estimates; Shares Fall

Note: This post is a work in progress. Yes, that’s the financial world we live in. A company turns in a record year — in Apple’s case, that means 68 percent year-over-year revenue growth and 384 percent net profit growth — and a beyond decent quarter with a return of 50 cents per share, sending shares down 8 percent because analysts expected 4Q05 revenue of $3.74 billion instead of the 3.68 billion Apple delivered. That 50 cents per share was aided by a tax benefit that came out to 12 cents a share so the actual earnings were $0.38 per share, beating the Thomson First Call estimate of 37 cents.
(Apple is offering its earnings calls as podcasts through iTunes. If anyone knows how to translate that into a subscription that can be used with other podcast services, please leave it in the comments or drop me a note.)

Apple cannot meet current demand for the Nano, described as a “staggering” success (among other adjectives). The company shipped more than 1 million in the first 17 days of the sleek product’s life. Tim Cook, EVP, worldwide sales and operations: “We ended with a backlog and I can’t predict when supply will meet demand.” After incessant questioning by analysts who wanted to know what’s holding up shipments, Cook said, “We would never allow manufacturing capacity to get in to the way; it is a component constraint and I don’t want to get into which one.”

– If you like any of the current non-Nano iPods and you want another one, sounds like you should go shopping soon. Apple is changing the iPod lineup, with a new holiday collection on the way. Cook: “Last quarter was the final quarter for the older products. I believe we will do even better with the product line we have for the holiday season.”

– A Fifth Avenue, New York store is in the works and Apple hopes to open it before the end of its fiscal year, which would be next September. Doesn’t sound like Holiday 2005 is likely but you never know with Apple. Apple plans to open 35-40 new stores in FY06.

No guidance on the product announcement scheduled for tomorrow despite the best efforts of multiple analysts.

Earnings release
| earnings call

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