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Apple on Europe and its competitors…

Finding newsworthy nuggets in Apple’s (AAPL) filings is something of a sport, one where there tends to be an unusual level of competition, where even the smallest statements get blown out of proportion. Given that fact, we were a bit surprised to find that nobody else seems to have picked up on this new disclosure that Apple inserted into the Risk Factors section of the 10-Q that it filed yesterday afternoon:

“…the uncertainty regarding the ability of certain European countries to continue to service their sovereign debt obligations and the related financial restructuring efforts by European governments may cause the value of several European currencies, including the euro to fluctuate, which could adversely affect the Company’s non-U.S. dollar sales and operating expenses in the impacted jurisdictions.”

To be sure, worries over Europe shouldn’t come as much of a surprise to Apple’s investors, who are undoubtedly still trying to digest Tuesday’s earnings. During the conference call on Tuesday afternoon, CFO Peter Oppenheimer mentioned European woes several times; and CEO Tim Cook, in response to a question from Goldman Sachs (GS) analyst Bill Shope said, “The geography that did not perform well was Europe. Europe was essentially flat, slightly positive year-on-year and that really hampered our total results.” During the quarter, net sales were up 16% in Europe, which seems pretty good until you compare it to the second quarter of 2011, when European sales climbed by 46%.

Europe wasn’t Apple’s only concern. The company (or at least their attorneys) also took a swipe at their unnamed competitors (Hello, Samsung!), noting that many of these competitors try to get ahead by “emulating the Company’s products and infringing its intellectual property.”

Image source: Apple at the Paris Louvre, via Shutterstock

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It’s earnings season, which means that filings have begun to pick up. At footnotedPro, our subscription service exclusively for financial professionals, we identify early warning signs and hidden red flags well in advance of the market. For more information, or to inquire about a trial subscription, please email us.