Apple (AAPL) Earnings: No Need to Panic

It’s October all over again for Apple (Nasdaq: AAPL).

That was the last time the most valuable company in the world’s quarterly earnings fell short of analyst expectations. It happened again yesterday.

For just the second time in 39 quarters, Apple’s earnings missed the mark. The company reported second-quarter profits of $9.32 a share, more than a dollar shy of the $10.37 per share analysts were looking for.

Though profits increased 20.7% from the same quarter a year ago, they were down 94% from the near-record first-quarter earnings. Revenue also dropped sharply, from $39.2 billion to an even $35 billion.

The mediocre earnings – at least by Apple’s impossibly high standards – have sent the stock tumbling 5% in early trading today.

But fret not, Apple investors. We’ve seen this before, and it has a happy ending.

 Apple’s April-through-June 2012 earnings slowed a bit for the same reason the July-through-September 2011 earnings did. In both cases, the company fell victim to its own rapid iPhone production.

IPhone sales were slower than expected last quarter largely because people are waiting for the iPhone 5 to be released. The latest rumor is that Apple’s latest invention will make its debut sometime in September.

Once it’s introduced, iPhone sales are sure to break records again. At least that’s what happened when the 4S debuted last October.

Apple’s earnings fell short of expectations in the third quarter a year ago when the company sold 3 million fewer iPhones than analysts estimated.  The company more than compensated for the dip by selling 37 million iPhone units in the fourth quarter – nearly double the tally analysts were expecting.

Look for a repeat performance once the iPhone 5 debuts. Whether or not that happens in the current quarter is unclear.

What is a virtual certainty, however, is that iPhone sales will bounce back. When they do, Apple shares are likely to follow suit.

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