Apple could warn on profit: analyst
dg> Could this actually happen? Who would have thought it possible? Does Apple still make computers?
Apple Computer Inc. (Nasdaq:AAPL - news) could warn that its fourth-quarter profit and revenue may fall short of Wall Street expectations, as it cuts back on shipments of its iPod digital music player ahead of a new version, an analyst said on Wednesday.
Apple shares slipped to an 9-month low after Credit Suisse First Boston analyst Robert Semple said he expects Apple, whose iPod device dominates the market for digital music and MP3 players, to forecast revenue of $4.6 billion to $4.8 billion, shy of the $4.9 billion seen by Reuters Estimates.
Semple added that Apple could forecast a quarterly profit of 50 cents a share, short of analysts' view of 52 cents a share.
"We expect Apple will once again use the September quarter to reduce iPod inventories as the company prepares for a refresh of its product lineup, which we continue to believe will occur in the Sept/Oct time frame," he said in a note to clients.
An Apple spokesman was not immediately available for comment on the report.
Apple shares fell to $54.43, off $1.20, or about 2.1 percent, in midday trading on Nasdaq, after earlier dropping to $54.13, its lowest level since October 2005.
The stock, which was among the biggest drags on the S&P 500 index and the Nasdaq market, has been beleaguered by concerns that updated versions of the iPod may be delayed to the fourth quarter, rather than the third quarter, and that sales of the iPod Nano, introduced last October, have been sluggish.
Talk of a rival music device and download service from Microsoft Corp. (Nasdaq:MSFT - news) may also be contributing to the weakness.
"We are continuing to hear that Microsoft may be much closer to launching its iPod killer, a wireless iPod. I think that could be behind the pressure we are seeing in Apple," said Jon Najarian, co-founder of information Web site insideoptions.com.
Microsoft will start selling a wireless digital music and video player to compete with Apple's iPod by Christmas, sources close to the matter recently told Reuters.
The new player, which Microsoft has been touting to record companies in the last few weeks, will let users download music and videos over the air, according to one source, a feature that would give it an edge over the iPod.
Few experts believe any rival product could dethrone the iPod, but a significant challenger could take a bite out of one of Apple's chief sources of revenue. Apple has relied on new models and services to re-energize demand for the iPod and its companion iTunes music software and service.
Its last new iPod device came out in October. |
