Another quarter has passed for the most valuable tech company on the planet, and once again, Apple is set to announce their earnings within the hour. Considering that Apple hasn’t released anything majorly new in a number of months, this earnings report will be an especially interesting one to keep our eyes on.
We’ll be covering the news as it unfolds – but in the meantime, it seems worthwhile to take a moment to reflect on what analysts expect Apple to announce. After scanning and digging through dozens of reports, we’ve rounded up some ideas of what to expect from Apple’s earnings today.
A Pessimistic Outlook
Many Wall Street watchers are pessimistic at best regarding Apple’s earnings. Apple’s sales and earnings are both expected to be lower than expected this quarter, according to the below handy chart from Fortune, rounding up the Wall Street consensus.
During Apple’s third fiscal quarter last year, they announced revenues of $35 billion, and profits of $9 billion. This quarter, the company is expected to announce profits of $35 billion and a $7 profit. Over the years, Apple has set up expectations for huge year-over-year growth, and given their lack of new product releases in the past months, that’s unlikely to happen this time around. As such, investors will likely see at least an initial dip in the company’s share price.
While that’s decidedly a pessimistic assessment, analyst figures are one of the primary things that many investors base their decisions on – despite the fact that iPhone sales at carriers are at an all-time high. There are also plenty of folks openly plotting against Apple – and some have even called for Tim Cook’s replacement as CEO, although they are a vocal minority.
A New Hope?
Apple has a chance to pour a heaping glass of cold water all over naysayers – and while that may not happen today, it’s likely to happen over the latter half of the year. Apple is expected to released an abundance of new products in the coming months – with iOS 7, OS X Mavericks, a new iPhone, and their beautifully redesigned Mac Pro topping the list. But will all that momentumbe enough for investors?
Other Things to Watch For
Another key item to watch is what Apple decides to do with their cash reserves. Announcing a plan to disburse more cash to investors would be a very positive sign for investors - and may help Apple turn investor attitudes from selling stock to retaining or purchasing additional stock.
My assessment is that Apple will likely announce better results than most analysts expect – in fact, it would be hard for them not to do so. The real question is how investors will react – will better-than-expected results be enough to put momentum back into the company’s stock? Or will shares continue to fall until Apple announces or releases new products – such as iOS 7, OS X 10.9, and new iPhones and iPads?
The company will address all of their key markets – including iPhone, iPad, and the Mac, will discuss their gross margin, their revenue and earnings, provide guidance for the coming quarter, and perhaps of most interest of all to investors, further discuss how Apple will manage their ever-increasing stack of cash reserves.
Whatever Apple announces – and however investors and analysts react as a result, we’ll have the news covered here at MacTrast – so stay tuned for what should be one of the most interesting earnings reports we’ve seen from the company in quite some time! Apple will announces its 2013 second quarter earnings in about two hours, and will hold a conference call today at 2PM Pacific/5PM Eastern to discuss those earnings. If you’d like to tune in live, click here for all the details!
And remember – we won’t see the market’s true reaction until trading opens once again tomorrow morning. So keep an eye on that stock ticker!