Apple Inc. leads investors on a metaphorical scavenger hunt every year, and that should kick off later this week.
Wall Street will be rewarded Thursday for listening to the earnings call corresponding to Apple’s
least exciting quarter, as it tends to contain clues about the more interesting stretch ahead. While Apple will discuss spring sales, the consumer-electronics giant also is expected to offer some sort of forecast for the current quarter — and this period often contains a couple of weeks or so of sales of the next-generation iPhone model.
Will Apple’s September quarter indeed feature the iPhone 15 this time around? That’s a key question, especially after BofA Securities recently warned that the iPhone 15’s selling debut could slip by a few weeks due to production issues, with the implication being that sales may not begin until the start of the December quarter.
See more: Waiting for the iPhone 15? You might have to hold out longer than you think.
All of that brings us back to Apple’s forecast, which is harder to parse these days. Before the pandemic, Apple would share a numerical expectation for total revenue and investors would seek to determine the expected iPhone arrival date based on that number. When the pandemic began, however, Apple ditched traditional guidance and instead started offering hints about how revenue could stack up relative to recent periods.
Wall Street could get some sense about Apple’s plans for the next iPhone launch when the company drops these breadcrumbs Thursday afternoon, though the mystery may not mean all that much in the long run. Maybe Apple won’t have the iPhone ready for sale toward the end of September as it did last year, but loyalists will probably be willing to wait a couple of weeks to get their hands on the new device.
The hardware guidance “could miss Street estimates” due to iPhone 15 delays, according to Barclays analyst Tim Long “but it’s not clear that it matters for the stock as bulls may expect a stronger [December quarter].”
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Of course, other factors go into the September-quarter outlook as well, and Wall Street will be watching the company’s commentary for signs of smartphone demand strength on the whole and in China when Apple reports fiscal third-quarter results after Thursday’s closing bell.
“While the recovery in global smartphone demand is below expectations, it appears that the premium market (and hence Apple) is less impacted,” Deutsche Bank analyst Sidney Ho wrote recently.
Harsh Kumar of Piper Sandler senses market concerns about Apple’s iPhone resilience in China, but he says they’re “a bit overblown.”
“In our conversations, most investors feel that a soft China could pose a risk to the numbers and further commentary, but we feel that Apple’s position in China is on a solid footing and that the company is likely to see only a small if any decline in its iPhone sales,” he wrote. “We also believe that if there is any sales weakness from China it is likely to be easily offset by strong sales momentum in India.”
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Analysts tracked by FactSet expect Apple to post $90.15 billion in sales for the September quarter, essentially flat with year-earlier levels. They also expect $81.74 billion in June-quarter revenue, down from $82.96 billion in that same period a year earlier.
Within the hardware business, analysts estimate $70.06 billion in September-quarter revenue, down from $70.96 billion a year prior. They model $61.89 billion in June-quarter revenue, down from $63.36 billion.
The FactSet consensus currently projects $44.55 billion in September-quarter iPhone revenue, up from $42.63 billion a year before. The June-quarter iPhone revenue forecast is for $40.23 billion on average, down from $40.67 billion.