Apple Missed Analysts’ Expectations
Although Apple has repeatedly cautioned investors that it would be facing supply constraints for its products, this shortage did cause Apple to come in behind what Wall Street analysts predicted for this quarter. Even though Apple posted a 29% increase in overall revenue, it seems that investors had expected the company to do even better.
The consensus prediction among analysts was that Apple would post revenue of $84.85 billion overall, so it’s $83.36 billion fell about $1.5 billion short of that. Not surprisingly, Wall Street had pegged the biggest growth in the iPhone category, expecting $41.51 billion in sales, versus Apple’s actual $38.87 billion.
That said, Apple did beat the estimates in two of its product areas, with Services coming in at $18.28 billion versus the $17.64 billion estimate, and a billion dollars more in iPad sales than predicted, at $8.25 billion versus $7.23 billion.
To be fair, Apple stopped providing any kind of official guidance to investors at the beginning of the global health pandemic, so it’s unclear if the company met its own expectations. This also means that analysts have a lot less information to base their predictions on, which could be resulting in some pretty unrealistic expectations too.
After all, Apple posted a staggering 47% increase in iPhone sales over last year, but that still wasn’t enough to satisfy Wall Street analysts, who expected a 57% growth. Apple’s stock dropped 3% in extended trading following the earnings call.