Apple's Rumored iPhone 5 Launch Boosts Stock Price

Fueled by the rumored launch date of the next iPhone, Apple

has advanced back over 600 on early trading. Earnings last quarter were, while spectacular by most measures, a disappointment for Apple. Analyst estimates were missed, with revenue increasing to $35 billion, up from $28.6 billion last year. Profits also rose to $8.8 billion – up from $7.3 billion a year ago. That was in line with Apple's guidance, but low compared to analyst estimates. This was certainly a case of inflated expectations – Apple has such a strong history of beating guidance, that investors have come to expect it. Those days may be over. Since Tim Cook took over as CEO, Apple has failed to beat guidance twice. It's possible we've seen the end of the company that shoots past everyone's expectations at every corner. Then again, perhaps we haven't.

Last quarter was a bit of a dead one for Apple. No major new products were released, and one product was coming to end of its cycle. Despite that, iPad sales soared 84% to 17 million, and iPhone sales jumped 28%, despite many consumers holding off for the rumored newest model. That new model is about to be unveiled – and Apple's profits should see a healthy bounce from this flagship device. The rumors surrounding the iPhone 5 have coalesced around a date – September 12 for the launch. Sales may not start until the 21st, but September 12 is when the new iPhone is likely to take over the news cycle. Not just a new iPhone, the iPhone 5 is supposed to be a significant redesign. Parts have been found that suggest a larger screen, a new charging port, a thinner body, and 4G connectivity. There are further updates that may or may not come to pass, such as NFC – Near-Field Communication – technology, which would allow the iPhone to act as a virtual wallet. The same effect could be achieved with the latest Bluetooth technology, another rumored addition to the next iPhone. There's even talk that advances in screen technology will allow a layer to be removed, which would both make the phone thinner, and sharpen the screen's appearance without having to increase resolution. Exactly what the new iPhone will contain remains speculation, but we can be relatively confident, it will be out soon. And, if it has any of the success of previous iPhones – a virtual certainty given Apple's rabid fanbase – we'll see a sharp uptick in profits in coming quarters. Last quarter, after all, the iPhone made up 46% of the company's revenue, despite a drop in sales as consumers waited for the next model. Further, Apple has a strong history of breaking all its previous records with each new iteration of a device. If that pattern holds – and there's no reason to think it won't – Apple will have a very healthy end to the year.