“Apple announces its March quarter results after the close today,” Chuck Jones writes for Forbes. “Not surprisingly total revenue is the first number to focus on. Apple’s guidance was $50 to $53 billion and the Street is projecting $52 billion.”
“Gross margin may be the second most important number from the March quarter since this is where any major shift in iPhone models being sold will show up along with any pressure on average selling prices (ASPs). Apple guided gross margins to come in between 39.0% and 39.5% and the Street is forecasting 39.5% (I am at 39.7%),” Jones writes. “EPS is important but since it is largely derived from total revenue and gross margins unless there is something funky in other income or the tax rate it won’t drive the stock as much as revenue/iPhone units and gross margin. The Street is at $2.01 and I am at $2.00.”
“China is probably the fifth most important number since it accounted for 23%, 41% and 53% of Apple’s total revenue growth the past three fiscal years, respectively, and 70% of the company’s revenue growth in the December quarter year over year,” Jones writes. “Revenue guidance for the June quarter is probably the third most important number. Since this is so closely tied to iPhone units you can quickly back into how many Apple expects to sell. The Street’s published June quarter revenue estimate is $47.3 billion but almost all the preview notes are expecting guidance to be below this number. Gross margin guidance is probably the fourth most important number.”
Read more – including services revenue, iPhone ASP and more – in the full article here.
MacDailyNews Note: On January 26, 2016, Apple provided the following guidance for their fiscal 2016 second quarter:
• revenue between $50 billion and $53 billion
• gross margin between 39 percent and 39.5 percent
• operating expenses between $6 billion and $6.1 billion
• other income/(expense) of $325 million
• tax rate of 25.5 percent