Apple shares nosedive as growth appears to stall

"CAVE CANEM"/Flickr

NEW YORK Apple (AAPL) shares plunged Thursday after the company reported quarterly results that point to growth slowing after five blowout years.

The stock fell $63.51, or 12.3 percent, to close at $450.50.

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Apple is still the world's most valuable company, a position it's held for more than a year. It's now worth just 3.5 percent more than No. 2 Exxon Mobil Corp, however.

Late Wednesday, Apple reported October-December earnings that were flat compared with the year before. Sales grew 18 percent from the year before, but the startup of production lines for multiple new products like the iPhone 5 and iPad Mini held back profits.

Of more concern to investors is Apple sales growth forecast for the current quarter of around 7 percent -far from the 50-percent-plus rate it's often hit in recent years. Apple usually lowballs its forecasts, but Chief Financial Officer Peter Oppenheimer indicated that it's moving toward providing more realistic figures from now on.

Analysts believe Apple is unable to fully capitalize on the global smartphone boom with just one new -and very expensive- phone model every year. There has been speculation among company-watchers that Apple may launch a cheaper iPhone, or a premium model with a bigger screen, but CEO Tim Cook put a damper on those rumors in his comments on a conference call following the report.

[jwolfe2010]

Jobs is gone, that's why there is no innovation.

[lkrupp]

Apple reported record numbers, they produced the highest earnings on record for a U.S. company EVER, and fourth largest revenue for a U.S. corporation EVER yet the hook headline for this article was that earnings were "sub par." What does that tell you? Then you have the idiots in this thread blabbering about innovation and what they need to do to survive. What? Apple is going bankrupt? Apple lost money? Apple has one foot in the grave? Circling the drain? Beleaguered?

[ralphing]

They don't need to make a cheaper model, they have a huge inventory of older models that are cheaper. All they have ever done is add new software updates to older software, but installed it in a newer phone to charge consumers extra money for hardware. Every feature in the iPhone 5, 4, and 4s, will run on the iPhone 3. The 4s runs Siri, and there is no reason that they couldn't have given that to the 3Gs, other then greed.

[yarnplay]

Growth isn't stalling, innovation is stalling.