Wall Street expects record earnings to kick off Apple's big week

Posted:
in General Discussion edited January 2014
As Apple prepares to report its earnings today at 5 p.m. Eastern time, most Wall Street analysts expect the company to report its best quarter ever, with the potential for record holiday iPhone and Mac sales.



On average, analysts expect Apple to report an 18.6 percent increase in revenue to $12.06 billion and $2.07 earnings per share. That would be driven by sales of 8.9 million iPhones, 21 million iPods and 3 million Macs. The three-month frame ended in late December, and represents all of Apple's holiday sales.



Analyst Shaw Wu with Kaufman Bros. remains above Wall Street consensus, with expectations of $12.4 billion in revenue and $2.15 EPS. He issued a note to investors Monday morning noting there is potential for upside to his estimates. He has predicted sales of 22 million iPods, 9.5 million iPhones and 2.9 million Macs.



"We believe there is room in all business areas, but particularly in the iPhone business, where we will likely see a new quarterly shipment record, beating its previous record of 7.4 million iPhones set last quarter, and close to RIM's record of 10.1 million BlackBerries shipped," he said.



However, his Mac estimates come in slightly lower than Wall Street, due to rumors of production issues with the newly redesigned iMac, released last October. In December, Apple apologized for shipment delays, but declined to acknowledge reports of problems, particularly with the new 27-inch model.



But competing analyst Gene Munster with Piper Jaffray has forecast 3.1 million Mac sales. If that prediction proves true, it would be Apple's best quarter ever. In October, the company reported its current best of 3.05 million Macs. Last quarter was also a record for iPhone sales, which hit 7.4 million.



Wu expects Apple to issue its traditionally conservative guidance for the coming March quarter. He has modeled $9.8 billion in revenue and $1.55 EPS, against market consensus of $10.4 billion revenue and $1.77 EPS. He has reiterated a buy recommendation, and Kaufman Bros. has retained its $253 price target.







Of course, Apple's results are only a part of the picture this week. Wall Street and technology enthusiasts are also eagerly awaiting the company's media event to show off its "latest creation," due to take place Wednesday at 10 a.m. Pacific time at the Yerba Buena Center for the Arts in San Francisco. It is widely expected that Apple will use the event to introduce its long-rumored touchscreen tablet device.
«13

Comments

  • Reply 1 of 55
    quadra 610quadra 610 Posts: 6,757member
    I'd be interested in seeing the updated iPhone market share numbers.
  • Reply 2 of 55
    ajitmdajitmd Posts: 365member
    More important... what the non-GAAP EPS for the last Q? $3.50 Anybody?
  • Reply 3 of 55
    dm3dm3 Posts: 168member
    Quote:
    Originally Posted by AjitMD View Post


    More important... what the non-GAAP EPS for the last Q? $3.50 Anybody?



    When does AAPL start reporting non-GAAP as GAAP?
  • Reply 4 of 55
    quadra 610quadra 610 Posts: 6,757member
    Quote:
    Originally Posted by AjitMD View Post


    More important... what the non-GAAP EPS for the last Q? $3.50 Anybody?



    Should be here:



    http://financial-alchemist.blogspot....ion-still.html
  • Reply 5 of 55
    nvidia2008nvidia2008 Posts: 9,262member
    Is this a first time a product launch follows so closely after an earnings report?
  • Reply 6 of 55
    Quote:
    Originally Posted by dm3 View Post


    When does AAPL start reporting non-GAAP as GAAP?



    They don't. However they did announce non-GAAP adjusted sales and non-GAAP adjusted net income in their press release from Q4. Non-GAAP diluted EPS was approximately $3.12 if I did my math correctly.
  • Reply 7 of 55
    Quote:
    Originally Posted by nvidia2008 View Post


    Is this a first time a product launch follows so closely after an earnings report?



    No, they announced the new iMac the day after they reported Q4 earnings.
  • Reply 8 of 55
    wingswings Posts: 261member
    It's interesting to note that according to the graph, the 12-month estimates were all reached in about 1 quarter (except of course the ones that haven't had a quarter of run time yet).
  • Reply 9 of 55
    I think Apple definitely has a hit on its hands. People are slowly but surely warming up to the idea that the tablet will be good for business, in addition to being an e-reader and a multimedia tool. Here's a couple of articles that indicate this:



    http://news.yahoo.com/s/pcworld/2010...albusinesstool



    http://www.alltabletnews.com/2010/01...k-replacement/
  • Reply 10 of 55
    vinney57vinney57 Posts: 1,162member
    Haven't the rules changed to allow opting out of GAAP in certain sectors, of which iPhone sales would be one?
  • Reply 11 of 55
    What's all this about The Gap? Are they having a sale?
  • Reply 12 of 55
    boogabooga Posts: 1,082member
    Quote:
    Originally Posted by dm3 View Post


    When does AAPL start reporting non-GAAP as GAAP?



    It's not that non-GAAP will be any more official, it's that the definition of GAAP is changing. So Apple won't need to use "subscription" accounting. Apple hasn't announced when they're going to end that, but maybe we'll hear something about it at today's meeting.
  • Reply 13 of 55
    Quote:
    Originally Posted by nvidia2008 View Post


    Is this a first time a product launch follows so closely after an earnings report?



    The first mac was launched at a shareholder meeting.
  • Reply 14 of 55
    Quote:
    Originally Posted by Quadra 610 View Post


    What's all this about The Gap? Are they having a sale?



    Cool. Ima get me some of those skin tight jeans deals. Maybe a cute top.
  • Reply 15 of 55
    If memory serves me, Apple has sold about 30MM iPhones in the last 7 quarters, plus an estimated 10MM this quarter. So, with subscription accounting, they realize 12.5% of 40MM phones (or ASP * Margin * 5MM). Without subscription accounting, it is (ASP * Margin * 10MM). Based on a $700 ASP and 30% Margin, it would add about $1B in profit or $1.17 in EPS to the GAAP numbers. High end it would be $1.50 extra, putting the total non-GAAP range somewhere between $2.71 and $3.50 based on analyst numbers. (Median would be $3.24)



    I'm guessing they will come in around $2.40/3.50 GAAP/Non.
  • Reply 16 of 55
    Quote:
    Originally Posted by Booga View Post


    It's not that non-GAAP will be any more official, it's that the definition of GAAP is changing. So Apple won't need to use "subscription" accounting. Apple hasn't announced when they're going to end that, but maybe we'll hear something about it at today's meeting.



    Since they've been reporting non-GAAP numbers for some time now, it will not be much of a real change when it does happen.



    Also FWIW, all quarters should be "record" quarters, especially when considered YOY. Anything less would be negative growth, AKA, a disaster (for stockholders, anyway). The real issue is whether EPS growth exceeds expectations.



    I'm going to take a guess and say $2.35 EPS. If it's much less than that, the stock will get hammered.
  • Reply 17 of 55
    mactelmactel Posts: 1,275member
    It won't be 3.1 million Macs sold rather 3.3 million.
  • Reply 18 of 55
    Quote:
    Originally Posted by nvidia2008 View Post


    Is this a first time a product launch follows so closely after an earnings report?



    quite possibly. part of which is due to Apple always adjusting their time table for Macworld (which was typically a week or two before the earnings announcement).
  • Reply 19 of 55
    Quote:

    It is widely expected that Apple will use the event to introduce its long-rumored touchscreen tablet device.





    This might disappoint some, but just because the attendants at CES produce a "tablet PC" running a full OS doesn't mean Apple is going too.



    Apple is building upon the App Store success with a larger, and better, iPod Touch. This article proves it.



    http://www.appleinsider.com/articles...ne_os_3_2.html



    I don't even believe they will risk changing the name to iSlate or iPad, they will want to identify upon the "iPod" branding installed in billions of people's minds.



    The iPod is Apple's most highest volume selling device.



    March could be a rough quarter for Apple (and for a lot of other companies), sales volume needs to be high, this means a reasonable priced product that primarily caters to games which sells so well on the App Store. A full Tablet PC will be priced to high just to run $3 iPhone Apps.



    I know Steve doesn't like to think his devices as just for games, so he's made hardware and software changes and deals to expand on other areas the device can be used for. E-Reader, drawing and painting for instance.



    The new larger iPod Touch will be a compliment device to a computer, not a standalone device like a Tablet PC.



    However, I suspect the App Store will start having higher priced and higher quality apps to meet the expanded capabilities of the new iPod Touch.



    The iPod Touch is going to grow, that's all. The rest is hype in my opinion.
  • Reply 20 of 55
    Quote:
    Originally Posted by MacTripper View Post


    This might disappoint some, but just because the attendants at CES produce a "tablet PC" running a full OS doesn't mean Apple is going too.



    Apple is building upon the App Store success with a larger, and better, iPod Touch. This article proves it.



    I don't even believe they will risk changing the name to iSlate or iPad, they will want to identify upon the "iPod" branding installed in billions of people's minds.



    The iPod is Apple's most highest volume selling device.



    March could be a rough quarter for Apple (and for a lot of other companies), sales volume needs to be high, this means a reasonable priced product that primarily caters to games which sells so well on the App Store. A full Tablet PC will be priced to high just to run $3 iPhone Apps.



    I know Steve doesn't like to think his devices as just for games, so he's made hardware and software changes and deals to expand on other areas the device can be used for. E-Reader, drawing and painting for instance.



    The new larger iPod Touch will be a compliment device to a computer, not a standalone device like a Tablet PC.



    However, I suspect the App Store will start having higher priced and higher quality apps to meet the expanded capabilities of the new iPod Touch.



    The iPod Touch is going to grow, that's all. The rest is hype in my opinion.



    I love iCal'ing the stuff you post.
Sign In or Register to comment.