Apple will release its first fiscal quarter results on February 1. Here's what happened in the holiday quarter and what the iPhone maker will reveal to investors.
Apple confirmed on January 8 that it will hold its holiday quarter earnings conference call on Thursday, February 1, 2024. The conference call will be held at 5 p.m. Eastern Time, when CEO Tim Cook and Chief Financial Officer Luca Maestri will explain to investors and analysts some details from Apple's first quarter 2024 financial report, which will be released at approximately 4:30 p.m. Eastern Time.
Details of the fourth quarter of the previous quarter
Apple's fourth quarter financial report for fiscal year 2023 was mixed, with revenue declining quarter-on-quarter for four consecutive quarters. Still, its results beat Wall Street expectations.
This quarter, Apple achieved revenue of $89.5 billion, down from $90.1 billion in the fourth quarter of 2022. Apple also announced earnings per share of $1.46.
During this period, iPhone revenue increased year-over-year from $42.6 billion to $43.8 billion. This offset a decline in iPad revenue from $7.17 billion in the fourth quarter of 2022 to $6.43 billion in the fourth quarter of 2023.
Mac revenue fell sharply from $11.5 billion in the fourth quarter of 2022 to only $7.61 billion in the fourth quarter of 2023. Wearables, home and accessories revenue also declined, but was only $9.32 billion, compared with $9.65 billion in the fourth quarter of 2023.
Services remained a reliable industry, growing to $22.31 billion from $19.19 billion in the previous year.
Cook described the performance as a record-high iPhone revenue in September and a record-high services revenue. Maestri added that Apple's active device installations hit all-time highs across all products and regions.
For the first quarter of 2024, Apple did warn that wearable device sales may slow down as the ITC sales ban creates problems for Apple Watch sales in the United States. In addition, Apple also expects Mac sales to increase.
In their post-earning analysis, analysts were quick to claim that Apple's earnings report was mixed and in line with consensus, but they also quickly moved into speculation about first-quarter earnings.
Year-end quarter: Q12023
In the four quarters before the first quarter of 2024, Apple's revenue in the first quarter of 2023 reached $117.15 billion. That's down from Apple's record quarterly revenue of $123.9 billion in the same period last year, and it's Apple's first quarterly revenue decline since 2019.
During the period, Apple earned $1.88 per share, down from $210 in the same period a year ago.
As usual, iPhone sales were the highest this quarter at $65.78 billion, although that number was also down from $71.6 billion in the same period last year. The problems at the Zhengzhou factory have affected us to this day and are part of the reason for the losses.
iPad revenue increased from US$8.4 billion in the first quarter of 2022 to US$9.4 billion in the first quarter of 2023, and service revenue also increased from US$19.5 billion to US$20.77 billion.
Mac revenue fell from $10.8 billion to $7.74 billion year-on-year, and wearables, home and accessories fell from $14.7 billion to $13.48 billion.
What happens in the first quarter of 2024
Historically, first-quarter results are Apple's largest source of revenue for the year, and there are several reasons for that.
The main reason is that this quarter is the time when the public buys Apple iPhones. Although iPhone 15, iPhone 15 Plus, iPhone 15 Pro and iPhone 15 Pro Max were shipped on September 22, the end of the fourth quarter of 2023, the first quarter of 2024 will be the first full quarter of sales and shipments of these models.
In addition to the iPhone, Apple also launched Apple Watch Series 9 and Apple Watch Ultra 2. Although the ITC ban caused limited sales problems in the United States, the ban did not affect sales in other parts of the world.
Apple also updated AirPods Pro 2 at the same time, adding a USB-C case. During the quarter, Apple launched a new USB-C Apple Pencil and held a "Scary Fast" event to release a new 24-inch iMac, 14-inch MacBook Pro and 16-inch MacBook Pro equipped with M3. Massive sales of Apple's catalog are also almost certain, as the products are launched during high-volume holiday sales.
The popularity of Apple's Vision Pro may help sales, but since it won't be released until February 2 and is in relatively limited quantities compared to the iPhone, it won't make much of a splash before its second-quarter earnings release.
Wall Street's view
Yahoo Finance data based on the opinions of 22 analysts on January 27 showed that Apple’s average revenue was US$108.37 billion, with the highest estimate being US$113.99 billion and the lowest estimate being US$108.37 billion.
According to opinions from 26 analysts, earnings per share are likely to be $1.93, with the high and low estimates of $1.98 and $1.88 respectively.
CNNMoney provides its own analyst survey data. As of January 27, the consensus sales forecast was $126.1 billion, with a high of $131.6 billion and a low of $114.2 billion.
In this case, earnings per share are expected to be $2.15, with a high and low of $2.51 and $1.72, respectively.
In Marketwatch on January 27, its analysts forecast average earnings per share of $2.10, with a high estimate of $2.17 and a low of $2.02.