Shares of Apple Inc. (AAPL) are lower by nearly 4% to $96.23 in pre-market trading on Wednesday following a miss on Q1 revenue estimates and issued guidance for Q2 on the low end of the Street’s expectations. Apple also reported its slowest rise in iPhone shipments since the handset’s introduction in 2007. The tech giant said it expects to sell 50-52 million iPhones in the March quarter. That compares to 74.8 million units sold in the first quarter.
In its quarterly report, Cupertino posted earnings of $3.28 per share, 5c above the analysts were expecting. Revenue rose 1.7% YoY to $75.87 billion, below views for $76.60 billion. The iPhone maker guided Q2 revenues of $50 – $53 billion, as compared to analysts’ expectations of $55.38 billion. This is Apple’s first revenue decline forecast in 13 years. Apple CEO Tim Cook explained on a conference call discussing the co.’s earnings report how a major factor in the quarterly miss is the stronger greenback, which is making it more expensive for Apple to sell its products overseas.
“We’re seeing extreme conditions unlike anything we have ever experienced before,” Cook said, pointing out that currencies like the Brazilian real is down more than 40%, and the Russian ruble is down more than 50%.
“Especially during a period of economic uncertainty, we believe it is important to appreciate that a significant portion of Apple’s revenue recurs over time,” Cook added.
On valuation measures, Apple Inc. shares are currently priced at 10.84x this year’s forecasted earnings. Ticker has a t-12 price/sales ratio of 2.37. EPS for the same period registers at $9.22.
As for passive income investors, the name pays stockholders $2.08 per share annually in dividends, yielding 2.05%.
Apple’s stock has lost a quarter of its market cap since its $134.54/52-wkh set in April 28, 2015.