Apple Earnings Will Michael Jackson Sales Boost iTunes?
Apple reported on Tuesday third-quarter earnings higher than analysts had expected, but provided its usual conservative guidance. Revenue came in at $8.34 billion, resulting in earnings of $1.35 per share. That's a 12 percent increase from a year ago, when Apple reported earnings of $7.46 billion and earnings per share of $1.19. The numbers for the quarter were even better than what analysts had predicted: They were expecting $1.17 in earnings per share and revenues of $8.2 billion. The second wild card notion is the late-quarter boost that the iTunes store received in the last week of the quarter from sales of Michael Jackson music. We do not put much credence in this being any material event because one artist’s sales, even a dead legend causing a boost in sales, is unlikely to mount much difference when a company is expected to post $8+ billion in sales for the quarter. Apple's earnings equate to more good news for the tech sector: last week had Intel, Dell, and IDC's survey of the PC market all pointing to signs of recovery. We'll have more details and will see what Apple executives and analysts have to say on the Apple earnings call at 2 p.m. Apple shares were up 2.1 percent to $154.69 in after hours trading.Still, Michael Jackson’s death did move some recordings. According to The Journal’s Ethan Smith, U.S. retailers sold 415,000 albums by Michael Jackson in the four days following his June 25 death, according to Nielsen’s SoundScan. That’s compared with fewer than 10,000 copies that were sold in the previous full week. Over half of those sales were digital downloads made on services such as iTunes and Amazon.com’s AmazonMP3.