Apple’s Q416 guidance could be significantly short of expectations

“Apple will give September quarter guidance when it reports its June quarter results after the close today,” Chuck Jones writes for Seeking Alpha. “Since the iPhone has been generating over 60% of the company’s revenue it is the main determinate for what revenue guidance will be. When you analyze how many selling days the iPhone has had in the September quarter you can determine the tradeoff between revenue in the September vs. December quarters.”

“With the iPhone 7 not expected to drive a significant upgrade cycle, how many days between its announcement and first day of sales Apple decides on will have a substantial impact on guidance,” Jones writes. “This year the average sell-side revenue estimate for the June quarter is $42.1 billion vs. guidance of $41 to $43 billion and their September quarter projection is $45.8 billion or an increase of $3.7 billion. As you can see this is a pretty big 8.8% increase vs. last year when guidance was only a bit higher than June’s reported revenue. Now it may turn out that Apple substantially beats June quarter expectations and guidance comes in at what is currently forecast but it does look like guidance could come in light to very light.”

Read more in the full article here.

MacDailyNews Take: Again, it’s not just the iPhone 6/Plus. As we reminded yesterday morning: “Importantly, iPhone SE counts toward iPhone unit sales [and revenue], too.”

Get ready for Apple’s Q316 iPhone SE surprises – July 25, 2016
Analyst downgrades Apple, says company has ‘peaked under the leadership of CEO Tim Cook’ – July 25, 2016
Jim Cramer expects ‘not great’ earnings from Apple tomorrow – July 25, 2016
Could Apple surge 10% after earnings tomorrow? – July 25, 2016
Apple is ripe for a rally – July 25, 2016
All eyes on Apple as avalanche of quarterly reports from Silicon Valley begin – July 25, 2016
Apple to release Q316 earnings, webcast live conference call on July 26th – July 22, 2016
MacDailyNews presents live notes from Apple’s Q216 Conference Call – April 26, 2016
Apple reports earnings miss in Q216 – April 26, 2016
MacDailyNews presents live notes from Apple’s Q116 Conference Call – January 26, 2016
Apple reaps $18.4 billion quarterly profit, the largest ever recorded by a single public corporation – January 26, 2016
Apple beats on earnings; sets all-time records for revenue, net income, and EPS – January 26, 2016


  1. I’m not expecting much. Tim Cook’s total abdication of Mac development has made a mess of Apple. I will start having confidence in Apple once Cook has been removed from his job.

    1. Mac development has not met our expectations, but you are indulging in hyperbole…”total abdication”? Really?!

      We had plenty of slow Mac cycles before Steve Jobs, and e had slow Mac cycles under Steve Jobs, too. Remember Mac portables getting stuck on G3 and G4 processors that also lagged in terms of clock speed? The G5 was only available on desktop Macs and the evolution of the G5 also lagged. It was not until the transition to intel CPUs that Mac development really picked up. And, despite the move towards industry standards (CPUs, data bus, RAM, I/O, etc.), Apple still limits Macs by not making them work with a wide range of industry standard graphics cards.

      The Mac world was not perfect in the 1980s. It was not perfect after SJ was given the boot. It was on very shaky ground in the mid-1990s. And, even with the incredible comeback under SJ, the Mac world was never perfect. We just had more excitement about each new release.

      People got tired of landing on the Moon after a few trips. The public is fickle and it is very difficult to maintain customer engagement by repeatedly producing “insanely great” products. But it is that excitement that most of us miss…the anticipation of the next big thing. We had a historic run under Steve Jobs from 1998 through 2009…truly a decade for the ages. I do not believe that it is reasonable or fair to judge Cook and Apple based upon that decade. After you invent fire and the wheel, progress tends to level out.

  2. Any sign of negativity could create a drop. Low guidance is often the worst because it signals weakness in the future.
    Apple’s problem is that the market expects them to show growth every quarter. It doesn’t matter if you make any money, you just have to grow. Look at Amazon and Netflix. Zero profit, good growth and high stock price.

    1. Look on the bright side, doggonetoo. Given AAPL’s relatively low P/E, the impacts of modestly weak results and/or weak guidance should have a less drastic effect on the stock price than for a high P/E company like Netflix. The focus of Wall Street is future expectations…is Apple on a sustained downward trend? It does not appear to matter if those expectations are based on fact or FUD.

      Personally, I am not concerned with a few “disappointing” quarters following a blowout iPhone 6 update cycle. Apple is still generating $10+ billion in profits per “disappointing” quarter and its new products and services are progressing well, if not nearly as explosively as the iPhone.

      It remains puzzling to me why Apple is bashed for not repeating the iPhone miracle while other companies (who have never come close to producing such a product) are lauded for beta products that are not even shipping to retail, much less producing profits. For Apple, it is “what have you done lately that is comparable to the iPhone.” For other companies, analysts are satisfied with beta demos and vaporware.

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