:max_bytes(150000):strip_icc()/INV_Apple_Store_GettyImages-1541245790-b16c3f239a8c41218b37a9728548e615.jpg "What You Need To Know Ahead of Apple’s Earnings on Thursday")
Key Takeaways
- Apple is expected to report its first quarterly revenue increase in a year and its best earnings per share in two years on Feb. 1.
- Sales of Apple’s iPhone 15, launched in September, could help to fuel earnings growth for the company.
- The company could face an antitrust suit in coming months based on allegations of anticompetitive practices involving the iPhone.
As tech titan Apple Inc. (AAPL) heads into its first-quarter fiscal 2024 earnings after market close on Feb. 1, the company could be poised for its first year-over-year (YOY) quarterly revenue gain in a year and its best earnings per share (EPS) in two years on the strength of rising iPhone revenue and services sales.
Analysts anticipate Apple will report net income of $32.56 billion, its highest since the first quarter of fiscal 2022, and an 11% YOY jump in EPS to $2.09 this quarter. Revenue is expected to climb by less than 1%, in the first gain since the fourth quarter of fiscal 2022.
| Analyst Estimates for Q1 FY2024 | Q4 FY2023 | Q1 FY2023 | |
| Revenue | $117.97 billion | $89.5 billion | $117.15 billion |
| (Diluted) Earnings Per Share | $2.09 | $1.46 | $1.88 |
| Net Income | $32.56 billion | $22.96 billion | $30 billion |
Key Metric: iPhone Sales
The iPhone has long been one of Apple’s key drivers of revenue. Sales of iPhones far outpace those of iPads, Apple Watches, and even the company’s line of Mac products. After the launch of the latest iteration, the iPhone 15 series, in September, investors will watch closely for the impact of this new line on Apple’s iPhone sales for the first quarter of the fiscal year.
iPhone sales are expected to reach $68.4 billion, the second-highest quarterly level in the company’s history. This would be an improvement of about 4% YOY, driven by early sales of iPhone 15 products. However, some analysts have warned that iPhone sales may not be able to keep up this momentum through 2024, based on a Bloomberg customer survey indicating a preference for holding on to phones longer without upgrading to the latest models.
Business Spotlight
It has been a mixed start to 2024 for Apple, one of the world’s largest companies by market value. Apple’s new spatial computing hardware, Apple Vision Pro, launches on Feb. 2, placing the company in an entirely new product category.
However, the company also kicked off the year facing a number of legal challenges, including a ban on U.S. sales of certain Apple Watches using blood oxygen sensors while the company works to appeal a patent infringement case. The U.S. Justice Department could also be moving closer to launching a major antitrust case against Apple over alleged anticompetitive practices with the iPhone.
Still, Apple shares have risen sharply in the last year, climbing close to 32% in the trailing 12-month period through Friday’s close.