Sentiment has changed drastically from most of 2012, when Apple could seemingly do no wrong. The world was in love with Apple, with its products dazzling the media, analysts and consumers alike. Now, just consumers appear to be dazzled, judging by the 47.8 million iPhones and 22.9 million iPads sold during the quarter. Apple does not break out iPhone sales by model, but noted that the iPhone 5 was in good supply, while the iPhone 4 was supply constrained (huh?). Wall Street wants more, and the media's not impressed, despite having little, if anything else, that comes close to Apple's quality and innovation.
Amazon's (AMZN - Get Report) hardware is suspect at best, with its Kindle Fire lineup of tablets. Google (GOOG - Get Report) can't make enough Nexus tablets to really make a dent. Android holds a dominant market share in smartphone sales, though much of that is due to Samsung, not Google itself. Microsoft (MSFT - Get Report) is getting into hardware, and sales of the Surface RT tablet have been "modest." Apple has failed to live up to the hype surrounding the company, partly due to its own lofty expectations, and partly due to the outside world.
Right now, it seems as if all hope is lost for Apple. Shareholders, though, would be wise to consider that the second half of 2013 may wind up being better than the first, notes
Morgan Stanley's Katy Huberty. Huberty, one of the most respected Apple analysts on Wall Street, removed Apple from Morgan Stanley's Best Ideas list, but noted that catalysts will start to appear in the summer of 2013. These include "a lower priced