Apple is set to report a stunning 50% jump in quarterly sales today.
However, Apple may face more pressing questions about the health of iconic chief executive Steve Jobs.
The world’s most valuable technology company announced yesterday that Jobs would take a medical leave of absence without specifying a return date or detailing Jobs’ condition, leaving investors in an information vacuum.
The only surprise in earnings is if there is anything less than glorious news
Apple has not dwelt on Jobs’ health, and Jobs himself asked for respect for his privacy in a memo to employees made public yesterday.
Aside from Jobs’ health, the company is entering 2011 on a roll, a cash-generating machine with surging sales across its product lines, even as it confronts rivals determined to halt its stunning run of success.
Wall Street is expecting Apple’s quarterly revenue to swell more than 50% to more than $24 billion after a bumper holiday shopping season. That would be a sparkling performance for a company of any size, much less one with a market value above $300 billion.
Apple’s advantages are well-documented: the global spread of the iPhone, which is expected to sell more than 60 million units this year; the rise of the iPad, and continued strong growth from the resurgent Mac line of computers.
Wall Street’s benchmarks for Apple’s fiscal first quarter, which includes the holiday shopping season, are sales of roughly 15.5 million iPhones, 5.5 million iPads and 4 million Mac computers.
After the close of regular trading hours on Tuesday, Apple is expected to report earnings of $5.40 a share on revenue of $24.4 billion, according to Thomson Reuters.
According to StarMine’s SmartEstimate, which places more weight on recent forecasts by top-rated analysts, Apple should post EPS of $5.47 on revenue of $24.5 billion.
Even so, an out-sized surprise in Apple results has become an article of faith among investors. The company has beaten Wall Street’s estimate by an average of 29% over the past two years, and bested on revenue by 9% on average.
“The only surprise in earnings is if there is anything less than glorious news,” said Barry Jaruzelski, a partner at consulting firm Booz & Co, last week.
Winning iPhone
The iPhone 4 and rival Samsung’s Galaxy S are forecast to have helped their makers race further ahead in the holiday sales season at the end of 2010.
On average analysts expect global mobile phone sales volumes to have grown 10.8% in October-December, a Reuters poll of 32 banks, brokerages and research firms showed.
“In 2010 we saw a gulf emerge between winners and losers which will only widen in 2011,” said Geoff Blaber, an analyst at research firm CCS Insight.
Among the largest phone makers reporting their December quarter earnings in the next two weeks only Apple and Samsung Electronics are expected to win further market share, with all others seeing their share shrinking.
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