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Rumor Roundup, Episode 14: "Confirmed"

There weren't many rumors this week, but what few there were mostly followed a theme: "confirming" things that are in no way whatsoever actually confirmed. But first, let's find out how much money the analysts think Apple earned in the past few months. Was it a $#!^load, a $#!^ton, or a metric $#!^ton?

Big money, big money, no whammies

While one analyst was ready with the pre-emptive doom and gloom for Apple's fourth quarter earnings, at least two analysts expect Apple's upcoming third quarter results to be yet another blowout.

Morgan Stanley: New iPhone makes AAPL a second half 2012 top pick (AppleInsider)

Analyst Katy Huberty, who's usually one of the analysts we hear from during Apple's quarterly financial calls, is taking a bullish view on Apple's next iPhone. It's not quite the "most important consumer electronics launch ever" hyperbole we've heard from other analysts, but she is predicting "one of the most significant product cycles in two years."

We won't know for quite some time whether she's right or not. However, it does bear noting that a few years back SeekingAlpha called Huberty "the worst analyst on Wall Street when it comes to forecasting Apple's financial situation." Ouch, man.

Apple is once again expected to crush Q3 with near-record earnings (BGR)

Another analyst expects near-record earnings from Apple at the forthcoming quarterly call. This time it's Stephen Rosenman of... SeekingAlpha? Hmm, somewhat awkward. It should be noted that SeekingAlpha's got no greater claim to Apple forecasting accuracy than Huberty; five months ago, when Apple's stock price hit $500 per share, SeekingAlpha predicted the stock would soon hit $790 per share.

Apple's current stock price is just over $600 per share, which means the stock has to gain nearly $200 per share in value over the next seven months for SeekingAlpha's prediction to come true.

Basically, take anything these analysts say about Apple's financial performance with a very large grain of salt. Over the past five years the most accurate financial forecaster has been Apple itself. The company consistently turns in earnings that are around 115% of whatever guidance it gave for the quarter. (You can see the roundup of analyst predictions over at Apple 2.0.)

Last quarter, Apple said it expected revenue of $34 billion for Q3. Don't be shocked if Apple's actual numbers come closer to $39 billion. Also don't be shocked if analysts like those at SeekingAlpha say Apple "missed" estimates if the company doesn't meet their $44 billion revenue predictions.

Same old rumors, bigger names

The Wall Street Journal and Reuters both rehashed rumors we've heard many times from outlets that don't get talked about on CNN. WSJ dragged out a month-old rumor about the next iPhone adopting new technology to get a thinner screen. Meanwhile, Reuters reiterated a rumor about the iPhone's dock connector shrinking that's even older yet.

Both articles cited that most dependable and upstanding of sources, "people familiar with the matter." This increasingly widespread media catchphrase is vague enough that it could mean virtually anything. In decreasing order of credibility, decreasing actual level of familiarity with the matter, and increasing likelihood of who these sources actually are:

  • Apple personnel actually working on the device
  • People at Apple not working on the device, but who totally know a guy
  • "Sources in the Asian supply chain"
  • Analysts

The trend so far this year has been wild and unsupported claims about next-gen features coming from lesser media outlets which are then supposedly "confirmed" when big-name bastions of journalism like the WSJ, Reuters, Bloomberg, or the New York Times say essentially the same thing the rumormongers have said for months. This feeds on itself when the rumor sites will say things like "Reuters Confirms a Smaller Dock Connector and Relocated Headphone Jack on Next iPhone" when it's probable Reuters is using the same sources the site referenced months before.

Without knowing who these outlets are actually using for sources, it's impossible to say with any confidence whether they've confirmed anything at all. I'd like to think that a paper like The Wall Street Journal knows better than to take a source like DigiTimes seriously, but worse things have happened.

Loose definition of reality

Apple Analyst: iPad Mini, iTV Are For Real (Mashable)

With a headline like that, you just gotta know Gene Munster is involved. Sure enough, the Piper Jaffray analyst addressed a financial conference and said, "The TV thing is real. It's just a function of time. Some suppliers are more open in talking about it than others."

If wishes were horses, then beggars would ride. And Gene Munster's horse would be pimped out with a 60-inch Apple HDTV. Unfortunately, Gene might be in for a bit of a wait...

Apple's HDTV Will Be U.S. Only At Launch, Might Not Ship Until 2014 [Analyst] (Cult of Mac)

Other analysts have pushed back the speculative release date for this still entirely nonexistent product. The Apple HDTV, which was supposed to come out two years ago, then last year, then later this year, then next year, apparently won't be coming out until 2014 now. And even when it does come out, it'll be US-only.

The reason? "Content deals," say the analysts. Because apparently, even though Apple has the rights to show iTunes media on iPod Classics, iPod touches, iPhones, iPads, Apple TVs, every model of Mac that can run iTunes, and every single PC out there, according to these analysts it would be a "massive burden" for Apple to negotiate content deals for the new device.

Keep in mind that every harebrained Apple HDTV rumor out there has described a device that's essentially the guts of the current Apple TV unit shoved into a big Thunderbolt Display. It's puzzling why these analysts think Apple would have to fight a two-year battle with content owners over that.

It's just as puzzling why we're still talking about an Apple HDTV at all when we haven't even seen a single shady "parts reseller" post dubious pics of the device's front faceplate online.

"Confirmed"

BGR made two separate BREAKING EXCLUSIVE "confirmations" about features in the upcoming iPhone. Though a couple paragraphs of words follow each of BGR's headlines, they aren't of much use -- BGR doesn't say much of substance to support either of these confirmed claims.

New iPhone on track for fall release, 4G LTE and NFC confirmed, final production starts later this summer

Confirmed: Apple's iPhone 5 to feature nano-SIMs, AT&T and other carriers already testing new cards

BGR doesn't explicitly cite any sources for either one of these stories. Let's just hope these confirmations are a bit stronger than last year's "confirmed" Sprint-exclusive iPhone 5 with 4G WiMAX.

Wall of Shame

Just like last week, there's only one item on the Wall of Shame. In fact, it came up as I was writing this article, which means we came this close to having a week free of DigiTimes-sourced rumors. Oh well. Maybe next week.

Anyway, DigiTimes "confirmed" that Pegatron has started building the new iPhone. It's not clear if they're using the same dictionary definition of "confirmed" that BGR does, but sources familiar with the matter say it's highly likely.

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