For Apple Inc. 2016 could be over again.
The iPhone maker's sales declined in each of the first two quarters of this fiscal year, and it is possible that the company could see a further decline at Apple
AAPL, + 0.35%
reports a Tuesday for the third fiscal quarter, with forecasts predicting substantially flat sales of a year ago. Consensus figures are currently showing a significant decline in revenues for the September quarter and a decline of more than $ 9 billion for the full fiscal year, more than 3%.
Apple reported a single-year revenue decline from a year earlier for a full fiscal year and three of the four fiscal quarters. This year, it was 201
These days, the decline is not as strong, but Apple's expected recovery will not be as strong – it's going to be difficult to dramatically raise the price of an iPhone again, as Apple did to recover hard times. The main catalyst for Apple's iPhone business is the introduction of 5G-enabled devices. However, this will not happen until next fall.
See also: The rush to beat China tariffs is driving up PC shipments, however, which could be bad for the remainder of the year 2019. Huge growth this fall, as consumers have no reasons for upgrade to new smartphones with only minor improvements. Apple will be showing its next iPhone generally in September, and the announced joint Tuesday should include at least one to two weeks of sales of the latest smartphone, thus giving the first indication of optimism for the next upgrade cycle.
Outside of hardware, Apple has a couple of wild-card options that could theoretically drive revenue growth, but it's unclear whether the company's new subscription offerings will resonate well. Apple's TV + Media service is not very new, and the subscription service for games has not been bought by key players in the industry, and pricing is still a mystery. Overall, Apple's services business is well on its way, recording the best quarter so far this spring. However, a class action and potential antitrust investigation could pose a threat to this path.
What to expect?
Analysts polled by FactSet estimate that Apple made $ 2.09 in June from $ 2.34 in the previous year. According to Estimate, whose crowdsources projections are from hedge funds, scientists and others, the average estimate is EPS of $ 2.18.
Revenues: The FactSet consensus foresees US $ 53.3 billion in revenue in the June quarter, while the estimated US $ 53.7 billion in revenue estimates. The company made a forecast of $ 52.5 to $ 54.5 billion. A year earlier, Apple reported a quarterly revenue of $ 53.3 billion.
Stock Movement: Shares have risen after seven of the company's past ten earnings reports, with the Apple's posted first quarter sales warning not being considered. The stock has risen 32% this year but has not seen much lately and has gone up only 1.7% in the last three months. The Dow Jones Industrial Average
DJIA, + 0.19%
of which Apple is a component, gained 2.5% over a three-month period.
Of the 40 analysts surveyed by FactSet covering Apple, 21 have purchased ratings, 15 hold ratings, and 4 sell ratings. The average price target is $ 213.35, 2.7% above recent levels.
What You Should Watch About
Some investors hoped that Apple would make a transformational acquisition over time after it promised to become net-neutral last year. Analysts are becoming aware of the conference call. Apple has agreed Thursday to pay $ 1 billion for Intel
Smartphone modem business, which arises in the course of litigation with Qualcomm Inc.
"We think the rationale (from Apple's point of view) to have an alternative solution to Qualcomm is quite logical," wrote Amit Daryanani of Evercore ISI the official agreement.
Daryanani expects a positive surprise from Apple in June's June quarter as services accelerate and Mac sales are better than expected. He also estimates that the consensus revenue forecast of $ 60.9 billion for the September quarter is conservative, leaving Apple plenty of room to give an optimistic outlook. He rates the stock with an outperformance of $ 227.
The antitrust suspects: Facebook and Apple appear to be the most vulnerable.
Morgan Stanley's Katy Huberty has rated Apple's earnings structure as "attractive" and also cited analysts' low expectations for the September forecast. Their look at third-party iPhone data suggests that Apple's trends are improving in China, which could be a welcome relief after quarters of uncertainty. It rates the stock as overweight with a price target of $ 247.
Instinet's Jeffrey Kvaal is also optimistic about the acquisition of modems and calls this a "smart move" consistent with Apple's previous ability to benefit from vertical integration. Regarding Apple's actual earnings, it sees no room for disruption to services or devices and rates the stock neutral with a target of $ 180.
The iPhone XS cycle is "likely to be slow," he wrote, as his US checks show "no increase in advertising activity after record lows in the first quarter." Kvaal also doubts that the recovery of games in China has contributed much to App Store.
After the Ministry of Justice has confirmed its investigation into the anti-competitive practices of Big Tech and Facebook Inc., regulatory and geopolitical aspects should also be highlighted
Management spoke publicly about a separate investigation into the business of this company. Apple is increasingly coming under fire for high commissions for developers making in-app payments for iPhones and other Apple devices. This applies in particular to Spotify Technology SA
SPOT, + 1.58%
which offers its app on Apple devices as well as competing with the company in terms of music.