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What You Need To Know Ahead of Apple’s Earnings Report

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Key Takeaways

  • Apple is set to report earnings for its fiscal second quarter of 2024 on Thursday after the closing bell.
  • Analysts expect the iPhone maker to report that revenue and earnings declined from the year-ago period.
  • Apple will report iPhone sales, which could provide insight into the company’s performance in China amid increased competition.
  • Apple also could provide updates related to its artificial intelligence plans.

Apple (AAPL) is set to report second-quarter earnings after the bell on Thursday, with investors likely to be watching for iPhone sales numbers and potential updates related to artificial intelligence (AI).

Analysts project Apple’s revenue to be $90.36 billion for the fiscal second quarter of 2024, down from the previous quarter and the same period in 2023, according to consensus estimates compiled by Visible Alpha. Historically, Apple has typically reported a boost to sales in its fiscal first quarter, due to seasonal holiday demand.

Net income is expected to be $23.26 billion, down from the first quarter and the year-ago period, when the company recorded net income at $24.16 billion. Analysts expect diluted earnings per share (EPS) to come in at $1.50 for the second quarter, down slightly from the same period a year earlier.

Analyst Estimates for Q2 FY 2024 Q1 FY 2024 Q2 FY 2023
Revenue $90.36 billion $119.58 billion $94.84 billion
Diluted Earnings Per Share $1.50 $2.18 $1.52
Net Income $23.26 billion $33.92 billion $24.16 billion

Key Metric: Soft iPhone Sales in China

Investors will be watching for iPhone sales figures, with a focus on China as sales there have plunged in the face of rising competition.

Analysts project Apple to report selling 51.6 million iPhone units in the second quarter, according to consensus estimates compiled by Visible Alpha, a decline from the 58 million reported in the year-ago period.

CFRA analyst Angelo Zino wrote that “investors will likely focus on China results,” saying that “on China, we expect a 15% decline, worse than expected,” though he noted it may be “largely factored into the lower revised guidance back in February, while revenue across other geographies will be stable.”

Melius Research analysts noted that with “guide for June likely muted” and “China issues to persist,” the iPhone maker needs “to give us something to look forward to.”

Zino said CFRA expects Apple “to announce a new $90B buyback and 3% dividend hike,” which could positively affect investor sentiment.

Business Spotlight: Updates on Apple’s AI Play

Unlike many of its big tech peers, Apple has been tight-lipped about its AI-related initiatives, leaving room for uncertainty about how the iPhone maker will leverage the emerging tech. Investors will be watching closely for any word Thursday on Apple’s AI strategy in the company’s earnings release and call.

Apple CEO Tim Cook said in February that the company has “some things that we’re incredibly excited about, that we’ll be talking about later this year.”

Apple could also provide details following reports in March that it bought DarwinAI, a Canadian AI startup.

Analysts have highlighted that Apple could be positioned to gain from an accelerated iPhone upgrade cycle as AI capabilities are integrated into the devices, but the company hasn’t made its plans for this clear.

Apple’s stock price has lost close to 12% since the start of 2024, trading at $170.24 as of 9:45 a.m. ET Wednesday.

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