Episode summary
Earnings Special: Apple's Forecast Disappoints, Despite Topping Estimates | Bloomberg Intelligence
Bloomberg Intelligence
· · 20 min · Hosts: Carol Massar, Tim Stenovec · Guests: Anurag Rana, Mark Gurman
Summary
Apple reported quarterly revenue of $114.48 billion and EPS of $2.10, both above Street estimates, with iPhone revenue also beating expectations at $57.58 billion. Even so, the stock initially fell in after-hours trading as investors focused on what the company said about the holiday quarter and the increasingly high bar for the shares after a roughly $1 trillion run-up since late June.
The discussion centered on two weak spots: Greater China revenue of $17.54 billion versus an $18.75 billion estimate, and softer signals in iPad and wearables. The analysts said the China result was especially important because it remains a major growth market for unit shipments, even as competition intensifies and comparisons get tougher after strong prior periods.
The guest analysts argued that the next important catalyst is guidance, not the just-reported quarter. They said Apple’s services growth looks like it may be slowing, gross margins will be a key question because of higher memory costs, and supply constraints around the new iPhone Duo could push demand into future quarters rather than hurting the longer-term story.
Key takeaways
- Apple beat on revenue and earnings, but the market reaction was muted because expectations were already very high after the stock's big rally.
- Greater China revenue missed estimates at $17.54 billion, reinforcing concern that Apple faces tougher competition and harder year-over-year comparisons there.
- The guest said gross margins are the key question, especially with higher memory costs and the need to protect profitability over the next three to four quarters.
- Services growth may be decelerating, and the analysts said that matters because a large share of services revenue is tied to Google search on Safari.
- Supply shortages around the new iPhone Duo could shift shipments into future quarters, which the guest said may support results later in the year.
Notable quotes
“Fourth quarter revenue 114.48 billion. That is a beat, folks”
“Greater China revenue, um, a bit of a disappointment again, 17.54 billion versus the street estimate of 18.75 billion”
“I think the biggest thing for us is what kind of guidance do they give going forward”
“The other piece here is greater China and services both uh either a big fall or a strong deceleration”
How the episode opens
Bloomberg Audio Studios, podcasts, radio, news. — This is a breaking news update from Bloomberg. Instant reaction and analysis from our 3,000 journalists and analysts around the world.
Apple just crossed the Bloomberg terminal. So, let's get to it, folks. Fourth quarter revenue 114.48 billion.
That is a beat, folks. Uh 113.47 47 billion was the street estimate. Fourth quarter EPS, $210 a share.
That's a dime better than what the street was expecting. Greater China revenue, um, a bit of a disappointment again, 17.54 billion versus the street estimate of 18.75 billion. We've seen certainly some good and bad quarters when it comes to China for Apple.
Fourth quarter revenue, as we said, a beat.
Okay, so let's go through it from a a beat or miss perspective. Fourth quarter, iPhone revenue a beat at 57.58 billion. Fourth quarter revenue a beat at $114.4 billion.
Uh fourth quarter greater China revenue coming in below estimates once again 17.54 billion. The estimate was for $18.75 billion. Wearables was a miss.
iPad revenue was a miss. Total operating expenses came in in line with estimates at $1.19 billion. Fourth quarter services revenue coming in uh we can say that met estimates 31.57 billion the estimate was for 31.58.
I'm going to give that one to Apple. That's a a meet of expectations. Mac revenue came in above estimates.
America's revenue came in just above estimates. Fourth quarter products revenue coming in above estimates at $82.9 billion. So fourth quarter greater China revenue missing at 17.54 billion.
But fourth quarter iPhone revenue a beat there 57.58 billion. and fourth quarter Apple revenue $114.48 billion a beat on the overall top line Carol and also a beat on the bottom line like you said earnings per share $210 estimate was for $2.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- apple earnings
- holiday quarter forecast
- stock expectations
- analyst estimates
- consumer tech
Companies and tickers mentioned
- AAPL
- Apple
Watch the episode
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
More from Bloomberg Intelligence
-
Instant Reaction: Nvidia CEO Jensen Huang Ousted by Nvidia Board | Bloomberg Intelligence -
Nvidia’s Huang Ousted by Board in Move That Roils AI Economy | Bloomberg Intelligence -
CoreWeave Shares Soar After AI Computing Firm Eases Debt Fears | Bloomberg Intelligence -
Anthropic Targets $1.4 Trillion Valuation in Blockbuster IPO | Bloomberg Intelligence -
Nvidia Probe Into CEO Affair Raises Thorny Questions for AI | Bloomberg Intelligence -
Election 'Blue Wave' & Your Wallet; Navigating AI-Driven Market Volatility | Bloomberg Intelligence
Bloomberg Intelligence, this episode and its artwork belong to Bloomberg. Octagon is not affiliated with the show; this page is an independent summary.
