How Apple’s earnings were covered

Apple, one of the most written about technology companies, reported slightly better than expected earnings Tuesday as iPhone sales picked up. The company is such a media darling that the Wall Street Journal, among others, live blogged the earnings release and analyst call.

Let’s take a look at the coverage. Here’s the lead of the Bloomberg story:

Apple Inc. (AAPL) reported third-quarter profit and sales that beat analysts’ estimates, spurring optimism that the maker of the iPhone and iPad can withstand an attack from low-end smartphone competition.

Earnings were $7.47 a share in the period, which ended June 29, the Cupertino, California-based company said today in a statement. Analysts had predicted $7.30 on average, according to data compiled by Bloomberg. Sales rose to $35.3 billion, topping the estimate of $35 billion

The results helped soothe investor concerns that increased competition and saturation in the smartphone market would drag Apple into a prolonged slump. While profit shrank in the quarter and iPhone sales fell from a year earlier, the company exceeded muted expectations — even while relying on an aging profit lineup that will be updated later this year.

“The bad news is really in the rearview mirror,” said Brian Blair, an analyst at Wedge Partners in New York. “What we’re going to see from here on out is numbers going up across the board for a couple of quarters. We’re going to see a product refresh and the kinds of things that get investors excited.”

Apple shares rose as much as 5.5 percent to $442 in extended trading after the results were released. They closed at $418.99 earlier in New York after dropping 31 percent over the past year. Even with the decline, the company has a higher market valuation than any other technology business.

The New York Times chose to lead with Apple’s success and how hard it is to top that:

Usually, the problem with enormous success is having to match it.

Apple has set standards for its financial performance so high in recent years that even the slightest headwind can worry investors.

But on Tuesday, when Apple reported a lower profit compared with a year before, investors were not deterred, sending shares up in after-hours trading after the results beat analysts’ expectations.

Apple reported that net income in the third quarter fell to $6.9 billion, or $7.47 a share, compared with $8.8 billion the same quarter a year earlier. The company said revenue was roughly flat at $35.3 billion, from $35 billion a year ago.

The net income beat the expectations of Wall Street analysts, who forecast $7.32 a share and revenue of $35 billion, according to a survey by Thomson Reuters.

The company has been showing signs of slowing growth, and the last quarter was no different. That is why investors have been clamoring for Timothy D. Cook to unveil “one more thing” — the sly slogan used by Steven P. Jobs, Mr. Cook’s predecessor as chief executive, before he announced a major new product — in the hopes that it will give Apple’s sagging stock a much-needed lift.

The Wall Street Journal story pointed out that many people are looking to Apple for the next wave of innovation, which hasn’t been as quick as others would like:

Apple’s results comes as investors watch for signs the company can continue to expand sales and profits as the smartphone market matures. The company has successfully done both for many years, but consumers seem to be waiting for new hardware models and signs Apple will enter entirely news businesses.

The last new product line Apple launched was the iPad in 2010.

While the company is known to be working on devices like watches and TVs, investors are looking for signs the company can also recover from a series of uncharacteristic missteps over new mapping technology, higher than expected popularity of older-model iPhones, and rising competition.

The Reuters story also pointed out that Apple is having trouble in a core market – China:

But revenue from greater China – an increasingly crucial market for the Silicon Valley giant as it strives for growth – dived 43 percent from the second quarter and 14 percent from the year-ago period.

Executives blamed China’s slowing economy for the revenue decline but did not elaborate.

“China is a huge opportunity for Apple,” Chief Executive Tim Cook said on a conference call. “I don’t get discouraged over a 90-day kind of cycle.”

Apple earned $6.9 billion, or $7.47 a share, on revenue of $35.3 billion. That compared with a profit of $8.8 billion, or $9.32 a share, on revenue of about $35 billion in the year-ago quarter.

Wall Street’s average forecast was for revenue of $35.02 billion and earnings per share of $7.32, according to Thomson Reuters I/B/E/S.

While earnings hit expectations, it does seem that investors are growing impatient with Apple’s lack of new product introductions. As revenue drops in key expansion markets, Apple will need to show expansion in some area in the next couple of quarters.