Episode summary
Apple Tops Sales Estimates; Wayfair CFO Kate Gulliver | Bloomberg Businessweek
Bloomberg Businessweek Daily
· · 35 min · Hosts: Carol Massar, Tim Stenovec, Ed Ludlow · Guests: Anurag Rana, Kate Gulliver
Summary
Apple’s quarter was solid but not spectacular: revenue beat estimates, iPhone demand was described as “extraordinary,” and China outperformed, yet the stock reaction stayed choppy because the Americas came in below expectations and iPhone sales only met forecasts. The conversation centered on what the release really implied about upgrades, pricing power, and whether Apple is gaining share by holding prices steady even as component costs rise.
A big focus was margins. The analysts argued that Apple’s gross margin improvement and huge free-cash-flow machine help explain why the stock keeps trading at a premium to Microsoft and Google, even without a similarly obvious AI story. They also said Apple’s $100 billion buyback and dividend increase fit its long-standing capital-return model, while the most important questions for the conference call would be memory costs, next-quarter iPhone momentum, and whether Apple can keep margins elevated.
The second half of the show shifted to Wayfair, where the CFO said the company is still gaining share despite a weak home-furnishings category. She pointed to 7.4% net revenue growth, strong adjusted EBITDA margin improvement, higher-end strength at Perigold, steady B2B demand, and early traction from physical stores. Later, the discussion briefly covered Roblox’s weaker bookings outlook, Reddit’s ad-driven growth, and Rivian’s long road to scaling EV production.
Key takeaways
- Apple’s revenue beat was driven by China strength, but the Americas shortfall and iPhone sales merely meeting estimates kept investors cautious.
- An analyst said Apple’s gross margins rose about 220 basis points, making memory prices the key question for the next two quarters.
- The analysts argued Apple’s premium valuation is supported by low capex, strong free cash flow, and a large buyback program.
- Wayfair’s CFO said the company posted 7.4% net revenue growth and its highest Q1 adjusted EBITDA margin since 2021.
- Wayfair said its guide does not assume category recovery, relying instead on share gains, Perigold strength, and store expansion.
- Roblox’s stock fell after it cut its full-year bookings forecast, highlighting the trade-off between safety rules and user growth.
Notable quotes
“Apple's overall second quarter revenue beat analyst estimates as did earnings per share”
“So, I think the going down the curve um and and and having an entry-level product is extremely important, especially because the growth is only going to come from emerging markets”
“They are not raising CapEx. They have an absolutely stellar ecosystem of products”
“our focus is less on, you know, when is the consumer going to recover and when are we going to see those category tailwinds”
How the episode opens
Bloomberg Audio Studios. Podcasts, radio, news. This is Bloomberg Business Week Daily, reporting from the magazine that helps global leaders stay ahead with insight on the people, companies, and trends shaping today's complex economy.
Plus, global business, finance, and tech news as it happens. The Bloomberg Business Week Daily podcast with Carol Masser and Tim Stenovec on Bloomberg Radio. Apple's overall second quarter revenue beat analyst estimates as did earnings per share.
In particular, China sales topping expectations. iPhone revenue matched the average analyst estimates. And this was a big headline.
The company authorized up to a $100 billion share buyback and boosted its dividend to 27 cents a share. Doing those big buybacks is not unusual from these companies. Right now, talking to our Anurag Rana, Bloomberg Intelligence senior technology analyst out there in Chicago.
And out there in San Francisco is Ed Ludlow, co-host of BTech. We continue to track uh the stock reaction Tim to hear.
Yeah, I'm just going through Apple's press release. Uh going seeing if we there's anything that that we missed. Uh extraordinary iPhone demand. — Yeah, exactly. Does that that I feel like we're talking about the Federal Reserve in the Fed's language here? Quote, "extraordinary." What does that mean?
So, that's exactly the thought that went through my head. How much does language in a statement matter? And so, I'm actually going to throw that question to um to Anurag.
But basically, that is the language, extraordinary demand. But they're also basically specifically calling out the 17E. Is that enough Anurag to infer an upgrade cycle?
Um just that that one sentence in a statement? See, if you go back and look at the previous quarter, we saw Apple iPhones doing really well. This quarter has done well.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- apple earnings
- iphone and mac demand
- tech product launches
- wayfair cfo
- regional sales performance
Companies and tickers mentioned
- AAPL
- W
- Apple
- Wayfair
Watch the episode
Watch “Apple Tops Sales Estimates; Wayfair CFO Kate Gulliver | Bloomberg Businessweek” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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