Although Wall Street closed mixed on Monday, the S&P 500 hit another record high as investors weighed corporate earnings ahead of the Federal Reserve’s two-day policy meeting on Tuesday and Wednesday.
After the bell on Monday, Apple Inc. (NASDAQ:AAPL) reported fiscal-fourth quarter earnings fell 8.5 percent to $7.5 billion, or $8.26 per share, on revenue of $37.5 billion, compared with earnings of $8.2 billion, or $8.67 per share, on revenue of $35.97 billion a year earlier. Wall Street had expected the tech giant to post earnings of $7.96 a share on revenue of $36.93 billion, according to analysts polled by Reuters.
“We’re pleased to report a strong finish to an amazing year with record fourth-quarter revenue, including sales of almost 34 million iPhones,” said Tim Cook, Apple’s CEO. "We’re excited to go into the holidays with our new iPhone 5c and iPhone 5s, iOS 7, the new iPad mini with Retina Display and the incredibly thin and light iPad Air, new MacBook Pros, the radical new Mac Pro, OS X Mavericks and the next generation iWork and iLife apps for OS X and iOS.”
Apple iPhone sales grew 26 percent, a record for the September quarter, as the company sold 33.8 million iPhones, compared with 26.9 million in the year-ago period. In addition, the tech giant sold 14.1 million iPads during the quarter, slightly up from 14 million a year earlier, while the company sold 4.6 million Macs, down from 4.9 million.
“We generated $9.9 billion in cash flow from operations and returned an additional $7.8 billion in cash to shareholders through dividends and share repurchases during the September quarter, bringing cumulative payments under our capital return program to $36 billion,” said Peter Oppenheimer, Apple’s CFO.
Although Apple exceeded Wall Street expectations on earnings and revenue for the quarter, the company issued fiscal 2014 first-quarter revenue guidance between $55 billion and $58 billion, compared with analysts' estimate of $55.70 billion, according to Reuters. The company added its gross margin for the first-quarter would come in between 36.5 percent and 37.5 percent, below analysts’ estimates of 37.9 percent.
Shares of Apple edged down 0.13 percent to $529.88 in after-hours trading on the news.
Also on Monday, nutritional supplement maker Herbalife Ltd. (NYSE:HLF) issued fiscal third-quarter earnings excluding items of $1.41 per share on revenue of $1.21 billion, compared with earnings of $1.04 a share on revenue of $1.02 billion a year ago. Analysts had expected Herbalife to report earnings excluding items of $1.14 a share on $1.20 billion in revenue, according to Reuters.
"We continue to execute on our core strategies and deliver record financial performance, marking our sixteenth consecutive quarter of double-digit top-line growth," said Michael O. Johnson, Herbalife's chairman and CEO. "Our initial 2014 guidance demonstrates our belief that the macro trend of global obesity will increase worldwide consumer demand for our products."
Herbalife said it forecasts its current fourth-quarter earnings to come in between $1.11 per share and $1.15 per share, compared with estimates of $1.15 per share, according to analysts polled by Reuters. In addition, the company raised its fiscal year 2013 guidance between $5.19 per share to $5.23 per share and introduced fiscal year 2014 guidance in the range of $5.45 per share to $5.65 per share.
After the bell, Herbalife shares initially rose over 4 percent on the news, then fell 1.41 percent to $66.96 in extended-hours trading.
Ahead on the earnings calendar for Tuesday, notable companies reporting quarterly results include LinkedIn Corp. (NYSE:LNKD), Yelp Inc. (NYSE:YELP), Pfizer Inc. (NYSE:PFE), JetBlue Airways Corporation (NASDAQ:JBLU), United States Steel Corporation (NYSE:X), The Goodyear Tire & Rubber Company (NASDAQ:GT) and Archer Daniels Midland Company (NYSE:ADM).
The Dow Jones industrial average was down 1.35 points, or 0.01 percent, to end at 15,568.93. The S&P 500 Index rose 2.34 points, or 0.13 percent, to close at a record 1,762.11. The Nasdaq Composite Index fell 3.23 points, or 0.08 percent, to finish at 3,940.13.