Apple reports QE June 2012 financial results on Tuesday, July 24, after market close
Last quarter Apple reported the 2nd best quarter in both company and technology sector history, exceeded only by the prior calendar Q4 2011. Revenues were $39.2 billion and earnings per share was $12.30 for the QE March 2012, following $46.3 billion in revenues and $13.87 earnings per share for the prior, and record, QE December 2011.
Total assets surged to $150.9 billion as Apple decisively established itself as the largest tech company in the world. Apple’s market capitalization is #1 worldwide. Cash and marketable securities were $28.5 billion. Add long-term marketable securities and the reserves are $110+ billion! Interestingly, $74 billion of this was offshore in April 2012.
Now for yet another encore after the unprecedented, record-smashing QE December 2011 performance and incredible and somewhat surprisingly strong QE March 2012 results. A further quarterly dip, which is not unusual in the annual cycle, is projected. Asia-Pacific revenues could surprise and drive revenues and EPS higher than expected.
Apple management projects $34 billion in total revenues and $8.68 GAAP earnings per share for QE June 2012, but is famous for setting the bar low for a beat. CEO Tim Cook and CFO Peter Oppenheimer did caution they did not expect the current gross margin (47.4%) to be repeated. Remarkably, as revenues have increased the past 2 quarters so have gross, operating, and net margins. So even a sizable beat on revenues this quarter may not equate to a corresponding increase in earnings per share.
First come the revenues. Apple says $34 billion and the analysts estimate $37 billion. The prior 2 quarters were $39 billion and $46 billion. A QoQ increase is doubtful but would be driven by Asia-Pacific sales, the YoY increase is a slam dunk.
Estimated QE June 2012 Total Revenues (GAAP)
Yahoo Finance Estimates: $37.23B avg, $34.54B low, $41.73B high, 41 analysts
Prior Quarter: $39.19B = -5% QoQ
Prior Year: $28.57B = +30% YoY
Outlook: $34 billion
Next comes the earnings per share. Apple says $8.68 and the analysts estimate $10.35. The prior 2 quarters were $12.30 and $13.87. A QoQ increase is doubtful, the YoY increase is a slam dunk.
Estimated QE June 2012 Earnings per Share (GAAP)
Yahoo Finance Estimates: $10.35 avg, $9.45 low, $12.51 high, 42 analysts
Prior Quarter: $12.30 = -16% QoQ
Prior Year: $7.79 = +33% YoY
Prior Quarter: Apple Reports Aaplsolutely Incredible Earnings!
Apple Income Statement Calendar Q1 2012 Apple reported total revenues of $39.19 billion, net income of $11.62 billion, and earnings per share of $12.30. From the prior calendar Q4 2011, these were -15%, -11%, and -11%, respectively. From the prior calendar year Q1 2011, these were +59%, +94%, and +92%, respectively. Gross, operating, and net margins increased impressively to multi-year, if not all-time, highs of 47.4%, 39.3%, and 29.7%, respectively. Cash flow from operations per share decreased to a still impressive $14.79. The operating expense ratio increased slightly but is an amazingly low 8.1%. iPhones were the primary driver of product sales, comprising 58% of total revenues, an all-time high proportion. The Americas region continues as the largest portion of regional sales, comprising 34% of total revenues, which is an all-time low due to the rise in Asia Pacific sales.
Apple Balance Sheet Calendar Q1 2012 Total assets increased to a record $150.9 billion. The capital ratio is a rock solid 68% of assets. The current ratio is adequate at 34%, but is misleading. More current investment assets have been allocated to long-term marketable securities, a noncurrent asset. Apple is extraordinarily liquid with strong capital. Apple has $28.5 billion in cash, cash equivalents, and marketable securities. Add long-term marketable securities of $81.6 billion and Apple’s cash and investment reserves are a mind-boggling $110+ billion! Return on assets has now reached an unbelievable +31.8%.
Disclosure: I have a beneficial interest in a long position in AAPL stock.