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Here’s what Apple’s earnings will probably look like tomorrow

The titan is no longer in free fall, but Apple’s expected earnings show the company is not what it once was.


Apple will be releasing its quarterly results on Tuesday (Pacific time) after the markets close. Its been a rather uneventful two quarters for the company; there have been minor hardware releases but nothing that excites buyers like a new iPhone.

While there may be a slowdown afoot at Apple, the company’s stock is doing better than before having stabilized from freefall. For long term investors that turns a heart attack into a mere migraine, considering last year the stock was eclipsing $700 and now its at $426, but it shows that the much feared stock correction has come and gone.

Here’s a rundown of what to expect tomorrow:

  • Revenue between $33.5 and $35.5 billion, with gross margins between 36 and 37 percent. This comes from Apple’s own revenue guidance, and analysts are expecting something around $35.18 billion according to most roundups.

  • Earnings per share are estimated to be at $7.34, according to analyst roundups. For some context this quarter last year earnings were at $9.32.

  • iPhones sold: This is also over the map. The conservative estimate comes from Lazard’s Edward Parker who believes there were 23 million sold, while Matt Lew, with the Braeburn Group, projects sales will hit the 32 million mark. Piper Jaffray analyst Gene Munster has the median projection with 26 million sold.

  • iPads sold: Analysts were also divided on the number of iPads sold in Q3. According to a roundup down by Fortune, the average estimate from analysts hit the 18.1 million mark. On the low end was a sales figure of 13.5 million from Pacific Crest’s Andy Hargreaves, which would represent a drop of 21 percent from last years sales; Paul Reina of the Braeburn Group out in the high estimate of 22 million iPads sold which would represent an increase of 30 percent from last year.

Apple’s earnings call won’t be an exciting show, but it will be an interesting partial insight into how CEO Tim Cook is planning to transform the company from a perpetual growth machine into a mature company with single digit growth rates. Apple is still doing extraordinarily well by any stretch of the imagination, but it is slowing down and the company must transition itself to be a different creature than what it once was.

Source: Fortune

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