Apple's profit surge stalls
NEW YORK — Apple's profit surge halted in the latest quarter, as a flood of new products like the iPhone 5 meant high start-up costs for new production lines.
Apple posted net income for the October to December quarter that was flat with the year before. It was the first time in years that Apple didn't post a double-digit earnings increase.
The report also made clear that Apple is no longer able to sustain the breakneck sales increases of the last three years, even with a fresh iPhone on store shelves.
Apple shares fell $54.01, or 10.5 percent, to $466.00 in extended trading, after the release of the results.
Net income in the fiscal first quarter was $13.1 billion, or $13.81 per share.
That still beat expectations, as analysts polled by FactSet had forecast earnings of $13.48 per share.
Revenue was $54.5 billion, up 18 percent from a year ago. Analysts were expecting $55 billion.
“The revenue number is dismal as far as what the expectations were,” said Jeff Sica, president and chief investment officer of SICA Wealth Management.
But he added that while it's an “incredible number” on its own, Apple has “fallen victim to the curse of high expectations.”
Apple shipped 47.8 million iPhones in the quarter, about 1 million less than analysts were expecting, and 22.9 million iPads, also about 1 million short.