What could go wrong with Apple’s earnings

Analysts are expecting Apple to soar in this quarter’s earnings report, with estimates for record-breaking figures for iPhone, iPad and Mac sales.

There’s no doubt there are high expectations for the company as it reports its holiday sales figures — and that’s exactly what could hurt the tech firm on the stock market.

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Last quarter, Apple had a rare miss when analysts projected around 20 million units in iPhone sales and the company delivered 17 million. This quarter, excited by the success of the iPhone 4S and what appeared to be a strong holiday season for Apple, the average street estimate for iPhone sales is hovering around 30 million.

Colin Gillis, an analyst from BGC, downgraded Apple to “hold” status ahead of last quarter’s earnings and hasn’t changed his rating based on the fact that there could be trouble for the stock if “results do not produce the large upside that is widely expected.”

In a note to investors, Gillis said that Apple could smash records and still disappoint expectations.

“We estimate that Apple needs to sell over 33 million iPhones to exceed expectations, compared to its prior record of 20.338 million units sold in the June 2011 quarter,” Gills wrote. He also noted that Apple could have sold every phone it made, but not have made enough to satisfy expectations.

Gills and others have also pointed out there are a couple of clouds on Apple’s horizon that could dampen the earnings estimate Tuesday.

For one, it will be important to take a close look at iPad sales this quarter and moving forward, particularly in light of Amazon’s launch of the Kindle Fire. Cheaper tablets such as the Fire, Gillis said, could reduce iPad sales simply because of their lower price points.

The demand for cheaper tablets is a worldwide phenomenon, gaining ground over e-book readers. A recent study from the Boston Consulting Group found that, worldwide, consumer tastes are changing from a “one-size-fits-all” model, which the firm says could be bad for Apple’s industry-leading tablet. There’s also a healthy appetite for the ability to use Windows applications on tablets in offices, though that demand is much higher globally than it is in the United States.

Gillis also pointed to the rising fortunes of Apple rival Samsung as a potential blow to its future. Not only has Samsung’s Galaxy line of phones and tablets provided foils for Apple’s products, Apple also lost a bid in a Dutch court to ban the Galaxy Tab in the Netherlands on copyright grounds.

In a post, patent analyst blogger Florian Mueller said the Dutch case comes ahead of what could be a similar ruling in Germany that could lift a temporary injunction granted to Apple against Samsung in August.

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