Malcolm Owen
Apple is predicted to have a drop in revenue year-over-year for Q2 2023, according to TD Cowen, with results forecast to show declines in iPhone, iPad, and Mac for the quarter.
Apple will be releasing its financial results for the second quarter of 2023 on May 4, and analysts believe it will be a fairly typical report. In a note to investors ahead of Apple's results, TD Cowen believes the figures will be in line with general expectations.
Cowen models overall revenues at a 5% decrease year-on-year, with revenue at $92.2 billion for the quarter. Earnings per share is expected to be $1.43.
It is estimated that seasonal iPhone demand and "relatively weaker year-on-year iPad, Mac, and Wearables shipments" along with "normalizing demand and product launch timing" will result in slightly decreased results.
For iPhone, Cowen believes that improved early shipments into China helps matters, but to expect iPhone revenues to be down 5% YoY. The new retail stores in India could "unlock a new source of demand as the year progresses," which will help future quarters.
Sales of iPads are modeled to be down seasonally, while Mac is also suffering from a "weaker computing demand," though M2 chip launches could still be a "positive effect." Cowen thinks iPad and Mac builds could be down 5% and 14% respectively.
Services will still continue to grow on "easy comps," though Cowen warns there could be some "downside risk to licensing revenues given digital advertising market trends."
"From a stock standpoint, we believe AAPL remains a defensive name given its market cap, strong FCF supported by iPhone and Mac replacement demand, and capital returns of $90-100B. AAPL typically raises the dividend on the Mar Q earnings call," the analysts add.
Cowen has given Apple an "Outperform" rating, with a price target of $195.
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6 Comments
Apple literally said this themselves on their last earnings call. And, they said iPad and Mac would be down double-digits
No surprises here
It’s called “stock price manipulation”
"Bad hardware sales figures."
OK, this is the problem. "Bad hardware" figures cannot equate with "some decline year to year." As an enthusiastic capitalist, I must say that one of the problems with our system is that often, corporate value is determined by endless growth.
Apple sells an average of 55 million+ iPhones per quarter. That's nearly a quarter of a billion iPhones per year. So if they sell 60 million in Q2 a year prior, a "bad" number is 58 million? That's the headline. The same goes for revenue. In 2013, Apple had revenues of less than $200b. 10 years later, their revenue has doubled to almost $400b. But somehow if Q2 2023 is 2% lower than Q2 2022, it's doomsday.
Sounds like Apple should’ve made a wider range of Mac computers, instead of the tiny selection of new Apple Silicon computers, they have managed so far in the transition to new chips, maybe the lower numbers will force Apple off of the pot? millions of people are waiting for something more.