This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Apple Surges on iPhone Surprise

Stocks in this article: AAPL

NEW YORK ( TheStreet) -- Apple (AAPL) shares climbed 4.42% to $437.50 before market open on Wednesday, lifted by the tech giant's better-than-expected third-quarter results.

The Cupertino, Calif.-based firm reported earnings of $7.47 a share on $35.3 billion in revenue late on Tuesday, above Wall Street's estimate of $7.32 a share and $35.01 billion.

Apple's iPhone sales, in particular, were a highlight, with the company selling 31.2 million of the smartphones, up from 26 million in the same period last year.

"The upside surprise was iPhone sales, which totaled 31.2 million units, about four million above the consensus estimate," wrote Charles Wolf, an analyst at Needham & Co., in a note released on Wednesday.

Apple's iPad story, however, was, less impressive. "The downside surprise was iPad sales, which came in at 14.7 million units compared to our estimate of 17.5 million units," noted Wolf. "A portion of the downside resulted from a liquidation of channel inventories."

The company sold 17 million iPhones during the prior year's quarter.

Speaking during the conference call to discuss the results, Apple Chief Financial Officer Peter Oppenheimer acknowledged the "tough" year-over-year iPad comparison, which he blamed on "significant channel inventory increase" and the availability of the third-generation iPad in the prior year's quarter.

Oppenheimer, however, hinted that Apple has a number of product announcements up its sleeve. "We're on track to have a very busy fall," he said, but did not divulge any further details.

Needham's Wolf expects the next generation iPhone and iPad to appear in the September/October timeframe, but does not predict any massive surprises.

"We do not anticipate products for new categories this year," he wrote. "However, it's no secret that Apple is working on wearable devices and has progressively increased the content available on Apple TV. These initiatives suggest that Apple should once again begin to enter new product categories in 2014, although it is difficult to imagine that they will be the revenue producers that the iPhone and iPad have turned out to be."

Wolf has a "buy" rating and $710 price target on Apple.

--Written by James Rogers in New York.

>To submit a news tip, send an email to:

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs