Following Apple’s record second quarter earnings report on Thursday, Piper Sandler analyst Harsh Kumar said the issues with Apple are “transitory” and its “fundamentals seem to be headed in the right direction.”
Apple executives warned that supply constraints would cause a hit of $4 billion to $8 billion in its fiscal third quarter. Apple Chief Financial Officer Luca Maestri also said COVID-related shutdowns were having some impact on customer demand in China.
Harsh Kumar, an analyst with Piper Sandler, said Apple’s guidance “may be considered a disappointment for all the wrong reasons.” Kumar said the issues with Apple are “transitory” and its “fundamentals seem to be headed in the right direction, but the short-term transitory impacts” were distorting the guidance.
Evercore ISI’s Amit Daryanani noted there were several issues to consider that could mute Apple’s top-line growth in the June quarter. In addition to Covid-related supply constraints, he also pointed to the war in Ukraine and headwinds from foreign exchange.
But Daryanani said given Apple’s comments that much of the supply issues have been resolved, “we expect some of these revenues to come back as they likely create more pent-up demand” for Apple.
MacDailyNews Take: While $4 billion to $8 billion is not an insignificant amount, for some perspective: in what is historically its weakest quarter, Apple generated all-time quarterly revenue of $97.3 billion or more than Citigroup is worth. In 90 days.
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