Apple will report its holiday quarter earnings tomorrow. Once again, all eyes will be on the iPhone. The device now represents the vast majority of the company’s revenue. So anything that can affect iPhone sales is a big deal.
And if you’ve been paying attention to Apple’s past earnings, you know that Apple has had a complicated year. In short, revenue has been down for three straight quarters. Analysts have been wondering whether Apple’s incredible run was over. Maybe Apple’s revenue has peaked?
It turns out that this quarter should be the first quarter during which Apple’s revenue grew again. Analysts are currently expecting $77.4 billion in revenue compared to $75.8 billion last year (up 2.1 percent). This is in line with Apple’s own forecasts as the company said it was expecting between $76 billion and $78 billion during last quarter’s earnings release.
iPhone sales should be up slightly with 78 million iPhones sold during the holiday quarter compared to 75 million a year ago. It’s hard to grasp such a big number. Analysts think that Apple has sold roughly 590 iPhones per minute. I don’t even know how Apple can produce them so quickly.
So that’s the big picture. If you’re not really into numbers, there are a few things that are going to be interesting. The MacBook Pro got a big refresh. It wasn’t available until the middle of the quarter, but it could have a significant impact on Mac sales in general. It’s been a bit stale on this front for quite a while, so this could be exciting.
The Apple Watch also received an update. But Apple doesn’t generally break out Apple Watch sales numbers. In December, Tim Cook said that Apple Watch sales were doing just fine. An IDC report wasn’t so optimistic about wearables in general. It’s clear that the Apple Watch isn’t going to change “the iPhone company” into a company with multiple widely successful products.
Finally, Apple likes to brand itself as a product and service company now. Let’s see how Apple’s services are doing this quarter. With Super Mario Run and a ton of new iPhones, revenue from services should be up. But does it represent a significant chunk of Apple’s bottom line? Not yet, probably.
I’m particularly excited about the earnings call with Apple executives. There are so many burning questions with Apple right now. Tim Cook won’t answer them all, but at least we might get a few hints. In particular, I want to know more about all the recent Apple car rumors, demand in China, the Qualcomm lawsuit and (yes) Trump.