Greenberg: Apple Stops Playing Games
Apple CFO Peter Oppenheimer did something remarkable on the company's earnings call Wednesday: He said (in not so many words) that the company would stop lowballing earnings estimates.
Speaking to investors on the earnings call, he said:
"In recent years, our guidance reflected a conservative point estimate or results every quarter that we had reasonable confidence in achieving. Going forward, we plan to provide a range of guidance that reflects our belief of what we are likely to achieve. While we cannot forecast with complete accuracy, we believe we are likely to report within the range of guidance we provide."
(Read More: Apple's Revenue Falls Short, Shares Dive)
Or put another way, the company seems to be saying it won't sandbag anymore.
Not that it ever came right out and said it was. It didn't.
But lowballing by Apple was widely accepted by investors as matter-of-fact. A few years ago, after Apple's stock rose in the face of what appeared to be weak guidance, I raised the issue in a column headlined, "Does Apple Always Lowball?" The reaction was pretty much -- "So? They alway do."
Lowballing in general is an issue I have been raising for years.
My Silicon Valley colleague, Jon Fortt, says he believes Cisco set the trend 15 years ago. "It seems psychologically similar to stockpiling cash, or pricing your IPO a little low for a first-day pop," he says.
But with Apple, Oppenheimer's comment is astounding on multiple levels:
It's a tacit admission the company used to play the "beat the street" game -- and did so better than anybody.
(Read More: Rumors of Apple's Demise May Be Greatly Exaggerated)
And it's an acknowledgement, without coming right out and saying it, that its business is starting to mature.
In my world, this is considered the ultimate resetting of the clock. By no longer intentionally lowballing, rather than playing to Wall Street, Apple is playing to reality.