Apple Earnings Preview: All Eyes on Next Quarter's Guidance Ahead of New iPhones, Apple Card, and Apple TV+

Apple is set to report its earnings results for the third quarter of its 2019 fiscal year at 1:30 p.m. Pacific Time today.

The quarter began March 31, 2019 and ran through June 29, 2019, according to Apple's fiscal year accounting calendar.

Apple's guidance for the quarter from April 30:

revenue: $52.5 billion-$54.5 billion
gross margin: 37-38 percent
op. ex.: $8.7 billion-$8.8 billion
other income/expense: $250 million
tax rate: approximately 16.5 percent

Apple's guidance suggests it will report its second-best third quarter ever by revenue:

2014: $37.4 billion
2015: $49.6 billion
2016: $42.4 billion
2017: $45.4 billion
2018: $53.3 billion
2019: $52.5+ billion

Wall Street's revenue estimates average out to $53.39 billion, slightly below the midpoint of Apple's guidance, based on 33 analysts tracked by Yahoo Finance. Earnings per share is estimated to be $2.10.

Key Facts and What to Look For

iPhone revenue of $26.5 billion, according to a Bloomberg average.
Product launches in the third quarter: 13-inch and 15-inch MacBook Pro refresh on May 21 (excluding entry-level 13-inch model, which was updated in July) and seventh-generation iPod touch on May 28.
Apple's guidance for its fourth fiscal quarter, which typically encompasses the launch of at least some new iPhone models in mid-to-late September. Wall Street expects fourth quarter revenue to be $61 billion, down around three percent year-over-year, according to Bloomberg.
Apple's revenue in Greater China and any potential commentary regarding the U.S.-China trade war. Apple reported revenue of $9.5 billion in Greater China in the year-ago quarter, which was 19 percent growth.
Apple's services revenue reached an all-time high of $11.45 billion in the second quarter, and investors will be looking for continued growth from the launch of Apple News+ six days before the third quarter began. The upcoming launches of the Apple Card later this summer and Apple Arcade and Apple TV+ in the fall could also be at least partially baked into Apple's fourth quarter guidance depending on exact launch dates.
Apple's "Wearables, Home, and Accessories" category also remains key. Last quarter, Apple said the category was the size of a Fortune 200 company, buoyed by the success of the Apple Watch and AirPods.

Apple's CEO Tim Cook and CFO Luca Maestri will discuss the company's earnings results on a conference call at 2:00 p.m. Pacific Time today. MacRumors will highlight key points from the one-hour call as it occurs live.

Tag: AAPL

This article, "Apple Earnings Preview: All Eyes on Next Quarter's Guidance Ahead of New iPhones, Apple Card, and Apple TV+" first appeared on MacRumors.com

Discuss this article in our forums