On the eve of its Mac OS X Mountain Lion release, Apple disappointed investors by missing analysts' revenue expectations by $2.22 billion. During its quarterly earnings call, Apple said it generated roughly $35 billion in revenue and $8.8 billion in net profit, or $9.32 per diluted share. Analysts, however, had predicted that the company would raise $37.22 billion in revenue or $10.37 a share, according to CNBC.com.
The biggest issue for Apple was with the iPhone, which missed analysts' sales expectations by 3 million units, The Washington Post reported. According to Apple, the company sold 26 million units. Analysts, however, had been predicting that the company would move 29 million units. That's a large drop from the 35.1 million iPhones the company sold last quarter.
In addressing the decline in iPhone sales, Apple CEO Tim Cook pointed to the rumors and speculation floating around about the next iPhone. Apple is expected to announce that device around October.
It wasn't just iPhone sales that trended downward. The company reported that its iPod sales also saw a decline, with 6.8 million units being sold, down 10 percent from the third quarter of 2011.
According to Apple Apple CFO Peter Oppenheimer, Apple sold 17 million iPads in the quarter, compared to 9 million iPads during the same quarter last year, an 84 percent increase and all-time quarterly sales record for the tablet. Mac sales also increased by roughly two percent year over year to 4 million units sold.
Prior to the call, Apple's stock has also taken a hit, dropping from an all-time high of $644 in the April to $600. In after-hours trading, the company's stock fell even further, dropping to $566.78.
The company's fourth quarter revenue expectations also fell short of analysts' predictions. According to Oppenheimer, Apple believes it will bring in $34 billion in the coming quarter versus the $38 billion analysts expected.
Still, despite missing its expectations, Apple still managed to increase its cash reserves from $110 billion in the third quarter to $117.2 billion.