Apple stock sinks on tepid forecast
The company’s projection raised the unsettling specter of Apple’s quarterly revenue declining from the prior year for the first time in more than a decade.
The Associated Press
SAN FRANCISCO — Apple’s holiday season proved to be a letdown, even though the company sold a record number of iPhones and iPads during its latest quarter.
The results released Monday further sharpened the challenges facing Apple, as the world’s most valuable company struggles to lift its stock back to where it stood at its peak of more than $700 in September 2012.
That was before investors began to fret about fiercer competition in mobile devices and the lack of a breakthrough product since the iPad came out nearly four years ago.
Apple’s management amplified those concerns with a revenue forecast for the current quarter of $43 billion, about $3 billion below analysts’ predictions.
The company’s projection raised the unsettling specter of Apple’s quarterly revenue declining from the prior year for the first time in more than a decade. It last happened during the first three months of 2003.
The cautious outlook is likely to feed perceptions that Apple is still losing ground to a myriad competing devices running Google’s free Android software.
Apple’s stock shed $43.30, or nearly 8 percent, to $507.20 in extended trading after the results were released.
The sell-off could give activist investor Carl Icahn more firepower as he wages a campaign aimed at prodding Apple’s board to spend more money to buy back the company’s stock to help boost the price.
The company ended 2013 with nearly $159 billion in cash.
Apple CEO Tim Cook sought to reassure investors during a Monday conference call. He reiterated previous statements that Apple plans to plow new fields in technology, although he didn’t provide specifics.