Apple today updated its investor relations page to announce that it will share its earnings results for the first fiscal quarter of 2018 on Thursday, February 1.
The earnings report will give us our first real look at iPhone X sales, as well as sales of the iPhone 8 and the iPhone 8 Plus throughout the holiday quarter. The iPhone X did not go on sale until November 3, and it was not included in Apple's fourth quarter earnings report.
Guidance for the first fiscal quarter of 2018 includes expected revenue of $84 to $87 billion and gross margin between 38 and 38.5 percent. It will be a record setting quarter even at the low end of the guidance range, as Apple saw $78.4 billion in revenue in Q1 2017.
Apple's quarterly earnings statement will be released at 1:30 p.m. Pacific/4:30 p.m. Eastern, with a conference call to discuss the report taking place at 2:00 p.m. Pacific/5:00 p.m. Eastern. MacRumors will provide coverage of both the earnings release and conference call on February 1.
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But I’ll be listening out for a few things:
1. iPhone X supply/demand
2. Services revenue
3. New US tax law and cash repatriation
4. Impact of batterygate and how it affects software updates going forward
What will be telling is the next quarter's estimates. Initial demand for the X has been met. The anticipated product shortages through the 2nd quarter aren't happening. I'm thinking demand for a $1,000 phone that appeals to people with discretionary income is going to be very heavily weighted toward the introduction date. You will still have the normal consumer purchases during the remainder of the year but I don't think the iPhone X will make up a significant percentage of sales.
My baseless prediction for 2nd quarter revenue estimates is $52 - $54 billion as the iPhone X supercycle plays out, unit sales continue to plateau at around 225 million annually, and the lower cost iPhone 7 models account for a higher percentage of the remaining sales until next year's models come out in September.
[doublepost=1514995783][/doublepost]Doing a stock split along with a buyback makes zero sense. One increases outstanding share, the other reduces. Either a company wants to lower the share price in an effort to get smaller fish interested or it wants to try to pump up the price by taking shares out of the market.
But stock splits are long out of favor except when it's to limit voting rights like Google did. They are recognized for the gimmick that they are. There is no longer a stigma of having a too high stock price. It's status now -- just look at all the multi-hundred $ and even thousand dollar stocks. That use to be reserved for Berkshire Hathaway. So forget about a stock split. Not happening.
We should see a dividend increase. Apple has been doing that annually. Hopefully it will get back to a 2%+ yield with the repatriated money now available and not having to issue bonds for them. Buyback is possible Apple has been doing this regularly. I don't expect them to increase the effort more than they have been doing. Backbacks are also a bit gimmicky and have not proven to be a silver bullet for stock growth.
Repatriation of offshore moneys into the US will spark majors acquisitions across 2018, partnerships for foundries. Software suite will get major upgrades with requirement or option for more cloud storage purchases.
Could we see a more powerful Siri subscription model?
Quarter 2 will show us iPhone SE 2 launch, better alliances with Indian government hopefully leading to more units sold. iBooks may have some headway in education or just reading culture there (over the full course of 2018), with the help of iTunes U localized.
Mac Mini to be introduced as well having a 30% profit margin is quite possible. Sales of a newly revamped model at decent pricing could be huge for say India or South American countries. We’ll see.
[doublepost=1514972729][/doublepost]Oh and larger stock buy back program with stock split (3:1), increase dividends. Looking forward to this.
Just how many free stock is currently available?