Apple's Jobs: Forecast uncertain
CEO says he can't predict how the current economic slump will affect the computer and electronics maker.
NEW YORK (CNNMoney.com) -- Apple, Inc. said Tuesday its fiscal fourth-quarter profit beat the street, but revenue missed expectations. The electronics and computer maker also issued an outlook that fell short of Wall Street's forecast.
"We don't yet know how this economic downturn will affect Apple," chief executive Steve Jobs said in a statement.
But he was confident that Apple would be able to retain its customers. "They are more likely to delay (purchases) than switch," Jobs said in a conference call with analysts.
The Cupertino, Calif.-based company reported net income rose 26% to $1.14 billion, or $1.26 per share for the quarter ended Sept. 27, compared with $904 million, or $1.01 per share a year ago. Analysts polled by Thomson Reuters were expecting $1.11 per share.
Sales rose 27% to $7.9 billion, compared with $6.2 billion last year. Wall Street was looking for revenue of $8.01 billion.
Analysts were split on the economy's effect on Apple sales. On the one hand, cash-strapped consumers may not be willing to spend money on expensive electronics.
After high oil prices and falling home values, "the consumer doesn't have the money to buy (products)," said Trip Chowdry, analyst with Global Equities Research.
On the other hand, the economic downturn may cause consumers to be more cautious with their purchases and aim for quality.
"If people continue to see Apple products as giving value, then I think they will continue to buy them," said Andy Hargreaves, analyst with Pacific Crest Securities.
Peter Oppenheimer, Apple's chief financial officer echoed Jobs. "Looking ahead, visibility is low and forecasting is challenging," he said in a statement. "As a result we are going to be prudent in predicting the December quarter.
Oppenheimer forecast fiscal first-quarter revenue of $9 billion to $10 billion and earnings per share between $1.06 and $1.35. Analysts were looking for $1.65 per share and $10.57 billion in sales.
Apple is known for understating its forecasts. "My guess is that they're even more conservative due to everything that's going on," said Mike Church, portfolio manager with Church Capital Management.