Apple's Earnings Surprise Fails to Propel Stocks Higher

Blue-chip stocks are lower today after mixed earnings results from Apple (NASDAQ: AAPL  ) and Caterpillar (NYSE: CAT  ) competed with a report that new-home sales came in above expectations for the month of June. With roughly an hour left in the trading session, the Dow Jones Industrial Average (DJINDICES: ^DJI  ) is down by 41 points, or 0.26%.

Apple earnings
Investors have been eagerly awaiting the results of Apple's most recent quarter. Over the past 12 months, shares of the technology giant have floundered, down at one point by as much as 45% from the high of $705 per share set in September of last year.

The concern in this regard has been threefold. First, as smartphones become increasingly commoditized, Apple's famously rich gross margin has begun to show signs of vulnerability. As Bloomberg News recently reported, the average price of a smartphone has plunged to $375 from $450 at the beginning of last year.

The net result is that companies like Apple and Samsung are making far less on each unit they sell. In the first three months of 2012, for example, the iPhone maker's gross margin was a staggering 47.4%. Over the most recent three months, that figure has dropped to 36.9%.

Second, it's been three years since the company came out with an entirely new product line. The last line it introduced was the iPad, which debuted in April of 2010. Since then, it's been rumored that the company is working on wearable technology -- specifically an iWatch -- and refining its Apple TV offering, but the company has yet to confirm or deny any rumors. Click here for a take on the rumors by the Fool's resident Apple expert, Evan Niu.

And finally, albeit as a consequence of the previous two, Apple has struggled to find growth on both the top and bottom lines. In the most recent quarter, Apple's net income dropped on a year-over-year basis by 22%, while its revenue advanced by less than 1%.

Shares of Apple are nevertheless surging today, up by nearly 6% at the time of writing, thanks to better-than-expected sales of its flagship iPhone. As my colleague Tim Beyers noted, the company sold an impressive 31 million smartphones over the quarter -- a 20% improvement over the same period of last year.

To read more about Apple's earnings, check out Evan's take on how Apple is putting its money where its mouth is.

Caterpillar earnings
On the other end of the spectrum, shares of Caterpillar are dropping 2.7% today on the heels of its worse-than-expected earnings report. The industrial giant has struggled since infamous short-seller Jim Chanos announced to the world that he was taking a short position in the industrial heavyweight.

"I believe the commodities super-cycle built on the back of the Chinese construction boom is coming to an end," Chanos told an audience at CNBC's Delivering Alpha conference last week.

And, at least thus far, Chanos appears to be onto something. For the three months ended June 30, the company's earnings and revenue fell by 40% and 16%, respectively, compared to the same month of last year. In addition, as my fellow Fool Dan Dzombak observed, "The company also cut its forecast for 2013 EPS from $7 to $6.50 and lowered its revenue guidance from $56 billion-$58 billion to $57 billion-$61 billion."

New-home sales
Finally, shares of the nation's largest homebuilders are all tanking today despite an upbeat reading from the Department of Commerce on new-home sales last month. According to the government, sales in June equated to a seasonally adjusted annual rate of 497,000. That's 35% higher than in the same month last year and 8.3% up from May.

The reason homebuilders like D.R. Horton (NYSE: DHI  ) and Toll Brothers (NYSE: TOL  ) are taking it on the chin, in turn, has to do with the trend in prices. To wit, the median price of a new home fell in June by nearly 5% from $262,800 in May to $249,700. And just like Apple's experience with falling iPhone sales, if this trend continues it will put pressure on these companies' margins, and thus their bottom lines.

Apple has a history of cranking out revolutionary products -- and then creatively destroying them with something better. Read about the future of Apple in the free report "Apple Will Destroy Its Greatest Product." Can Apple really disrupt its own iPhones and iPads? Find out by clicking here.