The Street's Martin Baccardax reported that Cook said revenue for the three months ending in December would come in around $84 billion, notably shy of the Street consensus of around $91.5 billion and the company's own previous guidance of between $89 billion and $93 billion. Cook pinned the weaker iPhone demand in China on several factors, including a slowing economy worsened by "rising trade tensions with the United States" and cited high prices tied to the strength of the U.S. dollar, fewer carrier subsidies and customers taking advantage of reduced battery replacements in the softened demand for new iPhones.
TheStreet's tech columnist, Eric Jhonsa, gave his top takeaways from the Apple announcement.
- China Weighed Heavily on Results
- iPhone Sales Were Under Pressure Outside of China as Well
- Services and Wearables Remain Growth Engines
- iPads Also Outperformed
- The Installed Base Continues to Grow Meaningfully
- Stock Buybacks Remained Aggressive -- and Are Likely to Stay That Way
None of this came as surprise to ActionAlertsPLUS portfolio manager and TheStreet's founder, Jim Cramer, who had previously called that Apple would miss the quarter back in Action Alerts Plus's December monthly call, which you can find here.
But what do you do now that Apple has pre-announced and shares have already plunged?
With over 30+ years of investing, Jim created 25 Rules for Investing that can help you avoid the novice pitfalls that even he fell into on occasion.
Rule 22 tells you what to do when a company pre-announces a short-fall:
Rule 22: Wait 30 Days After Warnings
"When a company pre-announces a short-fall do not think that it will come back any time soon," he says.
Here's why: "When a company pre-announces a bad quarter, it isn't just looking at the past. It is looking at its order book -- its future."
Pre-announcements signal not just weakness -- but ongoing weakness.
So watch Rule #22 and learn why Cramer thinks you should wait.
Want to watch ALL of Jim's Rules -- with no ad interruptions? It's easy, just click here to watch the entire Jim Cramer's 25 Rules For Investing!
or catch a few more of Jim's Ruleshere:
- Jim Cramer's Rule #1: Bulls Make Money, Bears Make Money, Pigs Get Slaughtered
- Jim Cramer's Investing Rule #4: Buy Damaged Stocks, Not Damaged Companies
- Jim Cramer's Investing Rule #5: Diversify to Control Risk
Want to learn about the history of Apple? Check out TheStreet's Behind the Label Series