Apple to Report 3Q Earnings, Investors Await New iPad Sales

By Erin Harrison July 18, 2011

Following stalled iPad earnings last quarter due to short supply, investors are anxiously awaiting the latest sales figures as Apple prepares to release its third quarter earnings at the close of the stock market July 19.

Wall Street analysts say the popular iPad is on pace to make more money for Apple than its entire Mac division by the end of this year, the Associated Press reported, but the company has been damaged by an inability to make enough iPads to meet consumer demand.

Apple had difficulty meeting demand for the iPad during the second quarter. Many consumers held out for the upgraded iPad 2 that became available this spring, but Apple was not able to keep up with consumer demand.

Meanwhile, Apple executives said that the company was working through the “mother of all backlogs” with the iPad, Apple COO Tim Cook said during last quarter’s conference call.

Financial advisors recommended purchasing Apple Inc’s August $365 call options to position for potential upside ahead of the company’s quarterly earnings, J.P. Morgan Securities’ equity derivatives strategists advised Monday, according to Reuters.

Apple, the world’s most valuable technology company revealed its Q2 2011 earnings in April with 83 percent revenue growth, and 95 percent profit growth in a call with its officials, toppling expectations of analysts and its own projections, TechZone360 reported.

Apple’s $337 billion market value “dwarfs that of Google Inc. and Microsoft Corp. Its iPhone, released in 2007, essentially created the mass consumer smartphone market, and the iPad, released last year, created a hot new computer category and has already sold 20 million units,” the AP said.

The AP said analysts expect earnings of $5.82 per share and revenue of $24.84 billion, according to FactSet. Apple’s stock is up 50 percent since last year.

In the same period in 2010, Apple earned $3.51 per share on $15.7 billion in revenue.

Erin Harrison is Executive Editor, Strategic Initiatives, for TMC, where she oversees the company's strategic editorial initiatives, including the launch of several new print and online initiatives. She plays an active role in the print publications and TechZone360, covering IP communications, information technology and other related topics. To read more of Erin's articles, please visit her columnist page.

Edited by Juliana Kenny

Executive Editor, Strategic Initiatives

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