Apple are expected to post a drop in quarterly profit when they issue their next financial report. The shrink may be their first drop in the last decade, hurt by products with lower profit margins and slower iPhone sales growth.

According to Bloomberg fourteen analysts have reduced their estimates for Apple in the last month, as shares in the world's most valuable technology company slide. Apple are facing growing competition from Samsung and Tim Cook is under pressure to release new hit products to improve sales figures.

Bloomberg say “An earnings report tomorrow may show that fiscal second- quarter net income declined 18 percent to $9.53 billion, or $10.02 a share, according to analysts’ estimates compiled by Bloomberg. Revenue is projected to show a rise of 8 percent to $42.4 billion, the slowest growth rate since 2009.

“The market is in show-me mode for Apple,” said Laurence Balter, an analyst at Oracle Investment Research who is based in Fox Island, Washington, and has a buy rating on Apple. “The market needs to see some evidence that the future looks bright because that candle is flickering.

Apple may raise its current quarterly dividend by 17 percent to about $3.10 a share, according to a Bloomberg estimate, based on payouts of other large technology companies, Apple’s projected earnings and the amount of cash it holds.”

Apple profit margins are getting tighter due to higher component costs and the introduction of lower priced products such as the iPad Mini. Investors also aren't showing faith in the Tim Cook management team to come up with a killer product. There are rumours of a new Apple iTV and iWatch, but no information at all on the products has been issued.

Kitguru says: Can Apple release a range of new leading products to drive sales further?

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