Apple Hang-over
Apple Inc. is having some bad days after a spectacular evening when it reported a blowout financial performance. Sold more iPods (21 million), and Macs, banked billions in cash and what not. However, like all of us who have had a bottle of wine (or two), they are waking up with a hangover. The outlook for the second quarter of fiscal 2007 isn’t so rosy, and as a result the stock is down almost 4 percent, and still heading south.
I think Apple is experiencing the down side of over-hyping. By announcing iPhone at the Macworld, the company has put purchasing decisions on hold for millions who were in the market for a high-end iPod. There might be little risk to the lower-end iPod Shuffles and Nanos, but the big profit-making high-end iPods might be at risk.
“We believe this [seasonal] risk is particularly pronounced given our concerns that some consumers may delay iPod purchases ahead of the iPhone lauch,†Bill Shope of J.P. Morgan wrote in a research note to his clients.
[Source: Om Malik]
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