Apple posted its first quarter results; $8 million net loss. Ouch. I’m sure the stock will drop like a stone as “analysts” and stock “experts” tell clientele to sell, sell, sell.
The loss isn’t really bad news when you take the reasons why into consideration. Why is this important? Because the “analysts” won’t, that’s why.
Apple’s revenues for the quarter were $1.47 billion, up 7 percent from the quarter a year ago. Gross margins were 27.6 percent, down from 30.7 percent in the year-ago quarter. So that explains some of it, right? Apple’s not making as much money per unit sold, even though sales were up.
But here’s the doozy: the “quarter’s results included a $17 million after-tax restructuring charge and a $2 million after-tax accounting transition adjustment. Excluding these non-recurring items, the Company’s net profit for the quarter would have been $11 million, or $.03 per share.” [emphasis added]
So, if Apple hadn’t taken the restructuring charge and the adjustment, it would have shown a profit. And its stock would still go down tomorrow, because Apple can’t win at the stock price game, unlike certain monopolistic computer companies.
Anyway, I don’t look at it as bad news. Apple is making the necessary adjustments it needs to make to stay healthy and competitive while the economy sorts itself out, and if I could afford it, I’d be snapping up more stock tomorrow when the morons dump theirs. Thus concludes this edition of the Retrophisch™ Apple Financial Analysis.