**Apple Set to Unveil Q2 Earnings: A Deep Dive into Key Metrics**
Earnings Call: A Window into Apple’s Performance
Get ready for Apple’s highly anticipated earnings call on Thursday after markets close. While expectations are modest, Apple has a history of surpassing estimates, even during challenging times. In February, the tech giant predicted sales on par with last year’s .84 billion and flat iPhone sales.
Analysts’ Projections: Setting the Stage
According to LSEG consensus estimates, analysts predict:
- Earnings per share: .50
- Revenue: .01 billion
Breaking Down Apple’s Business Units
Here’s how Apple’s various businesses are expected to perform, based on LSEG estimates:
- iPhone revenue: .00 billion
- Mac revenue: .86 billion
- iPad revenue: .91 billion
- Wearables, Home, and Accessories revenue: .08 billion
- Services revenue: .27 billion
China Conundrum: A Key Factor to Watch
Analysts expect Apple to forecast .23 billion in sales for the current quarter, translating to a modest 1.8% annual growth. However, one of the most significant factors to watch is Apple’s performance in China, its third-largest market.
In the December quarter, sales plummeted 13% in Greater China. Analysts anticipate .25 billion in China regional sales, marking a 14% year-over-year decline. This downturn raises concerns about deteriorating conditions in a crucial market where Apple manufactures the majority of its products.
Competition from Local Rivals Intensifies
Apple is also facing escalating competition from domestic companies, notably Huawei. Recently, Huawei released a 5G smartphone despite US export restrictions on advanced chips, posing a potential threat to Apple’s market share.
iPhone 15 Demand: A Wildcard
While Apple faces challenges in China, the performance of its latest iPhone 15 is another factor to consider. Some analysts suggest that the rumored iPhone 15 may be facing lower-than-expected demand.
Data Points Suggest a Slowdown in China
Third-party data corroborates the challenges Apple is facing in China. Research from Counterpoint Research indicates that Huawei’s growth surged by 70% annually, while Apple’s shipments declined by 19%, pushing it into third place.
Official statistics also reveal a 33% decline in iPhone sales in February, the second consecutive month of falling shipments.
Buyback Guidance: A Potential Catalyst
In addition to the quarterly results, investors will be paying close attention to Apple’s plans for share buybacks. Typically, the company updates investors on how much it intends to spend on repurchases for the rest of the year.
Conclusion:
Apple’s second-quarter earnings call will be a pivotal event, providing valuable insights into the company’s financial health and future prospects. While expectations are subdued, Apple’s ability to navigate challenges and post solid results could lead to a potential rally. However, investors should proceed cautiously and consider the company’s long-term outlook before making investment decisions.
Data sourced from: cnbc.com
