Apple provides positive and vague guidance for Q3

For three years running, Apple didn't provide specifics on what they expect for the next quarter, but chief financial officer Luca Maestri gave some color on what the company expects.

Apple's Q2 earnings beat expectations with $94.8 billion in revenue — a slight decline compared to Q2 2022. However, it is an improvement over the disastrous Q1, and it looks Apple will continue to see improvement through Q3.

During the Q2 earnings call held on Thursday, Apple CFO Luca Maestri provided some forward-looking guidance about Q3. Revenue is expected to trend similarly YoY to Q2 as long as the macroeconomic outlook doesn't worsen.

Foreign exchange continues to be a headwind at 400 basis points. Though Maestri says services should grow similarly to the March quarter, even with advertising and gaming headwinds.

Gross Margin over time

Gross Margin for Q3 is estimated at 44% to 44.5%, and operating costs to range from $13.6 billion to $13.8 billion. Maestri says the strength of the Gross Margin can be attributed to a flat foreign exchange rate, which helps.

The economic downturn has caused the tech industry to stumble as customers seek to save money and hold onto products longer. Despite that, Apple's iPhone business continues to be strong, keeping the forward-looking numbers positive.

5 Comments

larryjw 1036 comments · 9 Years

About 1 year ago

Expect an increase in services. Why?

Apple just emailed me that Apple TV subscription rises from $49.99 to $69.99 annually .

iOS_Guy80 899 comments · 5 Years

I received my notice about the Apple TV+ increase last September, effective October 1, 2022.

chasm 3590 comments · 10 Years

larryjw said:

Expect an increase in services. Why?

Apple just emailed me that Apple TV subscription rises from $49.99 to $69.99 annually .

I’m not sure why you didn’t get the memo earlier, but indeed that price increase went into effect late last year.

Also I’d point out that even at $70/year, that’s quite the bargain. You’re effectively paying $6/month for one of the best streaming services, and at the annual rate it’s also one of the cheapest. Offhand, I can’t think of any paid streamers that are cheaper.

blastdoor 3566 comments · 15 Years

Q1 earnings were not “disastrous”. Apple made $30 billion in profit— that’s not a disaster.

Samsung earnings fell 95% — that’s a disaster.

MacPro 19838 comments · 18 Years

blastdoor said:

Q1 earnings were not “disastrous”. Apple made $30 billion in profit— that’s not a disaster.
Samsung earnings fell 95% — that’s a disaster.

I came here to say the exact same thing. Not long ago Sammy was going to 'win' ... right? Not to mention Intel isn't exactly looking too good at the moment. Apple has done unbelievably well.

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