Apple faces massive expectations with today’s earnings report

After the closing bell today, Apple will report fiscal first quarter earnings results which are expected to feature an all-time revenue record, over $100 billion, for the company’s all important holiday period. Apple’s share price is up 80% over the past year.

Apple faces massive expectations with today's earnings report

Bill Maurer for Seeking Alpha:

The current street averages would mean year over year revenue growth of 12.44% [$103.24 billion] and earnings per share growth a little above that [$1.41].

When the company reported a very solid quarter back in October, the street average called for less than $100.50 billion in revenues for this fiscal Q1 period. Partly due to that dollar weakness, analysts have been hiking their numbers… Investors want to see strong iPhone sales for the quarter, but they also want to see a decent margin profile. Between the addition of 5G and many other new features, these phones were set to carry higher production costs. Apple did take away earbuds and the charging adapter to help save costs, so it will be interesting to see how margins fared. Also, the services category will be in the spotlight after the company’s launch of its services bundle, even though this fast growing category is already Apple’s second largest revenue contributor.

With shares continuing to set new high after new high, investors are going to expect great things from the company on Wednesday, so a small beat might not be enough to keep this rally going. While everyone is expecting continued revenue growth moving forward, Apple may need a blowout to keep the momentum going in the short term. If we do get a decent report but the stock sells off afterwards, a “buy the rumor, sell the news” event, investors should look to take advantage of the pullback.

MacDailyNews Note: As always, we’ll bring you Apple’s earnings results as soon as they’re available – just check our home page right around 1:30pm PT / 4:30pm ET today. We’ll also cover Apple’s conference call with live notes, as usual. That link will appear on our home page around 1:45pm PT / 4:45pm ET today.

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