Fiscal Quarter 1 Guidance

  • Posted: 19 October 2011 09:41 AM

    We expect revenues to be about $37 billion compared to $26.7 billion in the December quarter last year. We expect gross margin to be about 40%, reflecting approximately $60 million related to stock-based compensation expense. We expect OpEx to be about $3.25 billion, including about $350 million related to stock-based compensation. We expect OI&E to be about $85 million, and we expect the tax rate to be about 24.25%. We are targeting EPS of about $9.30.

    From the call transcript

    All I can say is that for Apple guidance - Wow.

    Emphasis is mine

         
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    Posted: 19 October 2011 11:30 AM #1

    The OpEx is higher than I expected by $ 200 million.  On the other hand, I hadn’t been adjusting for the seasonal increase.

    OI&E is comfortably above the $ 50 million that was common in the past.

    Tax rates, both in actual and guidance, have been stable for a while now.

         
  • Posted: 19 October 2011 03:25 PM #2

    Tetrachloride - 19 October 2011 02:30 PM

    The OpEx is higher than I expected by $ 200 million.  On the other hand, I hadn’t been adjusting for the seasonal increase.

    OI&E is comfortably above the $ 50 million that was common in the past.

    Tax rates, both in actual and guidance, have been stable for a while now.

    I came away from Apple’s guidance feeling they weren’t sandbagging as much as they have in the past.  If that’s true, forecasting Q1 results is going to be very difficult.

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    Posted: 19 October 2011 03:39 PM #3

    I don’t see any changes.  I think this is within the range of expectations. 

    For Apple to steer analysts wrong at this juncture (reducing the sandbagging while encouraging analysts to reach higher) would be a major mistake.

    Before anything else, I need to piece together a fiscal Q1 model to see what makes sense.

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    Posted: 19 October 2011 03:46 PM #4

    Some Q4 observations:

    With OpEx at about 9.4%, net income ratio down to 23.4%, and GM of about 40.2%, it’s very clear that iPhone has a tremendous impact on Apple’s profitability (not like there’s anything wrong with its profitability now anyway).  Interestingly, because not much changed between Q3 > Q4 product-wise, we may have a much better opportunity to assess the profitability of iPhone itself.

    IMHO, if 3 million less iPhones,with GM likely further dampened by 1.8 or so more million iPads, can affect profitability metrics that much (I’ll have to look into Apple’s “high” 24.7% tax rate later), the mind boggles at what +10M or more iPhones will do (albeit tempered with +2M or more iPads).

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  • Posted: 19 October 2011 05:59 PM #5

    Mav - 19 October 2011 06:46 PM

    Some Q4 observations:

    (I’ll have to look into Apple’s “high” 24.7% tax rate later)

    I’m perplexed by that as well.  Tax rate should have gone down as international sales went up.  Looking forward to your findings.

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  • Posted: 25 October 2011 06:50 PM #6

    I’m extremely surprised that nobody has linked the large projected numbers with the rumors about China mobile getting the iPhone this quarter.

         
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    Posted: 25 October 2011 06:53 PM #7

    That’s because there’s nothing to suggest that Apple is making a TD-SCDMA 3G version of the iPhone 4S.  If it does, 35 M units would be a production-limited number.  Also, we wouldn’t be talking a “mere” $37B in guidance.

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