CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
AAPL posted Sep-Q EPS of $1.46 vs. $1.29, beating the $1.39 consensus. Sales fell 1%, near expectations, with iPhone growth of 3%, which matched our forecast. We believe the biggest negative from the results was the 2% Y/Y decline in China, worse than we expected, as we look for greater clarity about AAPL’s outlook for the region in the Dec-Q, given concerns about increasing competitive pressures in the region. That said, growth of 16% from AAPL’s higher margin Services business was a bright spot (beating our 10% growth forecast), an acceleration from the 8% pace in Jun-Q and 5% in Mar-Q. This supported a wider-than-projected gross margin of 45.2% vs. 42.3% a year earlier (we were looking for 44.5%). We note that Macs plunged a worse-than-expected 34% (potentially reflecting AAPL clearing channel inventory), while iPads were down 10%. We believe the biggest question heading into the call surrounds AAPL’s China business and we will provide more clarity about our expectations after its earnings call today.