Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. On a side note, Apple benefited from the recent banking turmoil after launched its new banking service and a new savings account with a 4.15% interest rate, seeing inflows of almost $1bn in the first days of launching with 240k accounts signing up to the service, although you need to have an Apple credit card to qualify.ĭisclaimer: CMC Markets is an order execution-only service. The Americas were the one area of disappointment with revenues of $37.78bn, a big drop from last year’s $40.89b, a more than 7% decline. On a regional basis the Rest of Asia Pacific was a notable outperformer seeing revenues of $8.12bn, an 18.55% beat on forecasts, as well as a big jump from last year with India driving a lot of the gains. IPad revenues were $6.67bn more or less in line with forecasts, with Apple announcing another $90bn of buybacks and increasing the dividend to $0.24c a share. Wearables, which include the Watch, returned $8.75bn, also coming in above expectations, while Mac revenues saw a big drop from last year’s $10.4bn, and also fell 7.4% short of forecasts at $7.17bn. IPhone revenues led the way with $51.33bn, comfortably ahead of forecasts, and a record for Q2, while services revenue only saw a modest improvement to $20.9bn, also a record number, although it did come up short of consensus. Last night’s Q2 numbers saw revenues and profits beat expectations, coming in at $94.84bn, down from last year's $97.3bn, while profits came in at $1.52c a share. This was the second quarter in succession Apple had been unable to grow its revenues, the first time this has happened since 2016, but the fall of 3% was below the 5% Apple predicted when they reported in Q1. It’s also notable that Apple has been one of the few tech companies that hasn’t announced widespread job cuts, and last night’s Q2 numbers once again pointed to another strong quarter, even though revenues still declined from the same period last year. This is the reasoning behind the old Wall Street adage of “buy the rumor, sell the fact.The Apple share price hit its highest levels since August earlier this week and looks set to open higher when US markets reopen later today, as it continues to set itself apart from the wider market turmoil being seen elsewhere. You can attribute this to the market having responded to the favorable news spread as a rumor by already discounting it by the time the earnings actually become known to the general public. For example, a company’s stock might rally significantly before a better than expected earnings release but subsequently sells off after the release.Such rumors can prompt traders and investors to take positions in advance of the official earnings announcement. Another reason for a diverging stock price from a positive or negative earnings release are the rumors spread among savvy market participants ahead of the release.In both cases, the stock price might decline despite an unexpected rise in earnings. (NASDAQ: NFLX) might beat the market’s consensus EPS estimation but miss its subscriber growth expectation. (NASDAQ: AAPL) might beat analysts’ EPS estimation but miss their number of iPhone sales estimation. A low PER could indicate either that the stock is undervalued or that the company’s business model cannot sustain higher earnings, so its share price has fallen although earnings have not been affected yet. A high P/E ratio could mean that a company’s stock is currently overvalued or that expectations of higher earnings are already included in the stock’s current price. Price-to-earnings ratio (P/E ratio or PER): This important metric gives you an idea of whether a stock is overvalued or undervalued in relation to its earnings.Many analysts consider the EBIT growth as more important than total revenue growth since it provides a broader picture of the company’s profitability. EBIT: Earnings before interest and taxes (EBIT) is one of the most important metrics stock analysts consider because it takes into account the company’s net income before deducted interest and taxes.Depending on the company’s expenses and other outlays, a rise in total revenue can lead to increased earnings. Total revenue: Total revenue reveals the amount of money the company takes in from its sales of either goods or services.Earnings per share means the company’s profit/loss attributable to each shareholder of the company. Earnings per share (EPS): A metric that provides a key indicator of a company’s profitability.
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