No one knows nothing: Apple edition
- January 24th, 2012
Apple just reported the second most profitable quarter for any company, trailing only ExxonMobil’s record quarter in 2008 in the aftermath of the oil price blowoff. By any measure Apple’s quarter was incredible. We could continue to cite you crazy statistics but chose to link to them below. As Josh Brown at Reformed Broker wrote: “Apple is insanity.”
By any measure Apple destroyed the estimates of both the sell-side and the always more bullish independent analysts. For example, Apple’s earnings were a dollar higher than the highest analyst estimate. The second, soon largest, company by market cap was able to report earnings no one expected despite being the most scrutinized company in the world. Apple is doing what no other megacap company has been able to do. Organically grow revenues and earnings at a rate even a small startup would be happy with. As Rolfe Winkler at WSJ says: “Apple is breaking the law of large numbers.”
Kid Dynamite at his blog says “Apple is rewriting the rulebook – it was previously impossible for megacap companies to put up growth numbers like this. Amazing.” In an earlier post we noted the challenge that Apple would face as a megacap. The performance this quarter is a cold slap in the face of anyone thinking that it could not deliver continued spectacular results.
Apple’s results highlight this simple fact: no one knows nothing. The most followed (and analyzed) company in the world was able to exceed even the most bullish analysts’ estimates by a wide margin. If this can happen, then it should remind us that anything, good or bad, can happen in the markets. Any one telling you they know something will happen for certain, just remind them about Apple 2012 Q1 results.
Items worth a look:
Apple first quarter results. (Apple)
The Apple quarter was a record for any technology company. (CNNMoney)
Apple blew away the Street. (Apple 2.0)
Apple’s monster quarter in charts. (SplatF)
Apple’s growth rate is accelerating. (ReadWriteWeb)
Apple added $38 billion in cash last year. (Asymco)
More crazy Apple statistics. (TechCrunch)
Apple’s profits ($13 billion) exceeded Google’s entire revenue ($10.6 billion). (@farhadmanjoo)
Apple’s current cash level of $97+ billion is more than the MARKET CAPS of 474 S&P 500 companies! (@bespokeinvest)
Five years ago the iPhone and iPad did not exist. Now they make up 75% of Apple’s revenues. (The Atlantic)
Apple TV is beginning to matter. (GigaOM)
Abnormal Returns is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon.com. If you click on my Amazon.com links and buy anything, even something other than the product advertised, I earn a small commission, yet you don't pay any extra. Thank you for your support.
The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.
Abnormal Returns has over its seven-year life become a fixture in the financial blogosphere. Over thousands of posts we have striven to bring the best of the financial blogosphere to readers. In that time the idea of a “forecast-free investment blog” remains as useful as it did six years ago. More »
- Q&A with Tobias Carlisle author of Deep Value
- Wednesday links: mean reversion revisions
- Building a personal margin of safety
- Q&A with Wesley Gray of Alpha Architect: part two
- Q&A with Wesley Gray of Alpha Architect: part one
- Sunday links: dime a dozen
- Top clicks this week on Abnormal Returns
- Saturday links: penny stock punishment
- Friday links: personalizing the market
- Podcast Friday: ballooning fees