Apple stock rises as CEO Tim Cook scares investors with one phrase

Apple (AAPL) CEO Tim Cook and his right-wing CFO Luca Maestri spoke to their Wall Street in-house economist about the tech giant’s earnings report late Thursday night.

After Apple’s rare earnings miss, Cook and Maestri used the phrase “complex economy” seven times in one variation of the P&L phrase. Both are unusual for the mighty Apple.

“The macro environment last quarter was noticeably more challenging than 12 months ago,” Maestri told analysts.

Shares of Apple, which fell significantly in pre-market trading on Friday, nevertheless rose on Friday.

The economic problems that Cook talked about can be seen in Apple’s earnings.

Apple earnings review

  • Income: 117.1 billion dollars against the expected 121.1 billion dollars.

  • App. earnings per share: $1.88 vs $1.94 expected

  • iPhone income: $65.7 billion vs. expected $68.3 billion

  • Mac income: $7.7 billion vs. expected $9.72 billion

  • iPad Income: $9.4 billion vs. expected $7.7 billion

  • Wearable: $13.4 billion versus $15.3 billion expected.

  • Services: $20.7 billion vs. expected $20.4 billion

  • Wins: 1) Demand in China seems to be gaining momentum; 2) $50 billion plus cash on the balance sheet; 3) Supply restrictions have largely ceased.

  • Misses: 1) Again, no revenue forecast for the March quarter; 2) the negative tone of the executive branch in relation to the economy; 3) Weak wearable sales due to economic conditions.

Despite occasional slips and a cautious tone from Cook & Co., the Wall Street bulls are not resting on their laurels.

The collective atmosphere is such that everyone knew the quarter would be weak as China’s economy slowly recovers and US consumers spend more cautiously. In turn, Apple’s last quarter could be just as bad as it has been for iPhone and Mac makers this year.

Or so the bulls are betting.

Bears will quickly point to negative sales growth, but when adjusted for the exchange rate, we note that sales and outlook are flat, which is significantly better than other consumer electronics companies. billion active Apple devices and iPhone installed base estimated at 1.2+ billion),” Citi analyst Jim Suva said in a note to clients.

Suva, who will be on Yahoo Finance Live on Friday discussing Apple, left his buy rating on the stock.

Apple CEO Tim Cook unveils the new iPhone 14 at an Apple event at their headquarters in Cupertino, California, USA, September 7, 2022. REUTERS/Carlos Barria

Apple CEO Tim Cook unveils the new iPhone 14 at an Apple event at their headquarters in Cupertino, California, USA, September 7, 2022. REUTERS/Carlos Barria

Yahoo Finance Dan Hawley contributed to this story.

Brian Sozzi is the editor-in-chief and Lead at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and beyond LinkedIn.

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