Apple earnings: What to watch

Apple reports its fiscal first-quarter (holiday 2021) earnings on January 27th. Ahead of the earnings report, here’s what to watch.

Apple Park in Cupertino, California
Apple Park in Cupertino, California

Daniel Sparks for The Motley Fool:

Analysts have big expectations for Apple’s top line. On average, they expect revenue of $118 billion for the period. Though this only represents about 6% year-over-year growth, it’s a bullish forecast when you put it into context. First, consider the tough comparison Apple is up against. Revenue in the year-ago period rose 29% year over year. Second, supply constraints and logistical challenges in the company’s most recently reported quarter were so great that management opted to refrain from providing specific revenue guidance for fiscal Q1, coinciding with the fourth calendar quarter.

Analysts expect Apple’s earnings per share to grow even faster than revenue. On average, analysts are modeling for earnings per share of $1.88, representing year-over-year growth of 12%.

Apple’s earnings per share typically grow faster than its revenue because of the company’s aggressive share repurchases. By reducing total share count over time, Apple’s net income is spread across a shrinking number of shares, contributing to earnings-per-share growth.

MacDailyNews Note: As usual, we’ll have Apple’s results as soon as they are available, right around 1:30 p.m. PT / 4:30 p.m. ET and follow that with live notes from Apples’ conference call on January 27th.

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1 Comment

  1. “On average, they expect revenue of $118 billion for the period”

    We’ll see. Tim Cook said they’d comfortably beat last year’s Christmas record 111 billion but what does comfortably mean? Apple knocked it out of the park in terms of product roll outs. Almost all revenue for new iPhone 13 and all revenue for S7 Watch, AirPods 3, New Macs will be realized for the Christmas quarter. However the question is how did supply chain effect them? Apple said it would affect iPads.
    Double digit YoY revenue growth is what makes the dim thinkers at Wall Street happy. That would be about 122 Billion, maybe 123 billion. If Apple hits that they’re golden. Hitting only the expectation of 188 billion will be considered underwhelming. I suspect better parts availability could have squeezed 122/123 but I doubt that happened.

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