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Services Revenue, iPhone Sales & Other Key Q4 Apple (AAPL) Estimates
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Shares of Apple (AAPL - Free Report) have slipped over 6% in the last month amid what has been a brutal October for tech stocks and the larger market. The iPhone giant could, however, turn things around when it releases its Q4 financial results on Thursday. So, it’s time to see what to expect from some of Apple’s key business units as they could move the needle, either way.
Apple Overview
Many people understand at this point that the massive success of the iPhone catapulted Apple into a unique stratosphere: the first publicly listed U.S. company to reach $1 trillion in market value. Apple CEO Tim Cook and other executives showed off the new iPhone XR, iPhone XS, iPhone XS Max, and the Apple Watch Series 4 at a product event last month to hype sales before the holiday shopping period.
And Apple wasn’t done there. The tech power is set to introduce new iPad Pros, its latest MacBook Air, along with a new Mac Mini and other devices at a launch event in Brooklyn Tuesday. These products and the newest crop of iPhones will hardly, if at all, show up on Apple’s fourth-quarter earnings results since its fiscal quarter ended on September 30.
Still, the hype surrounding the second product event in two months could help boost Apple stock ahead of Thursday’s earnings release. With that said, Apple and its shareholders know that the company has to continue to branch out beyond the iPhone and some of its other older product lines, which have struggled as of late. Apple has done this through a few different avenues on top of raising the cost of its flagship smartphone.
Apple is projected to see its adjusted Q4 earnings soar by 34.8% to reach $2.79 per share, based our current Zacks Consensus Estimate. Meanwhile, Apple’s total quarterly revenues are expected to climb by 16.95% to hit $61.49 billion. Now it's time to understand what to expect from some of Apple’s different business units.
To prepare for this, we can turn to our exclusive non-financial metrics consensus estimate file. The Zacks Consensus NFM file contains detailed estimate data for business segment metrics and non-financial metrics reported by companies. The data is acquired from digest and contributing broker models and includes the independent research of expert stock market analysts.
iPhone
Apple’s total iPhone unit sales are projected to climb less than 1% from 46.677 million in the year-ago period to 46.954 million, based on our latest NFM estimates. Luckily, the newer, higher priced phones, including last year’s 10th anniversary iPhoneX, looks poised to lift total iPhone revenues in a big way.
Apple’s Q4 iPhone revenues are projected to hit $35.651 billion. This would mark a roughly 23.5% climb from the fourth quarter of 2017’s $28.846 billion. Last quarter, iPhone unit sales rose marginally from 41.026 million to 41.300 million, while revenues jumped 20% to reach $29.906 billion.
Clearly, the iPhone is still Apple’s most important business unit, with it expected to account for roughly 58% of total quarterly revenues. But another Apple business segment is likely to grab even more attention Thursday.
Services
Wall Street has focused heavily on Apple’s expanding services business, which features iTunes, AppleCare, Apple Pay, and Apple Music. Our current NFM estimates are calling for services revenues to reach $10.546 billion. This would mark a 24% climb from the year-ago period’s $8.501 billion. Services would also account for just over 17% of total Apple revenues, based on our estimates.
It is worth noting that this would mark a slow down from services’ 31% growth in Q3 and 34% expansion in the year-ago quarter. Therefore, we should pay close attention to this figure when Apple reports as it could foreshadow how AAPL stock trades, especially in the near-term.
Bottom Line
We can see that iPhone revenues are expected to continue to surge despite slow year-over-year unit sales growth. At the same time, Apple’s services business, which aims to take on (SPOT - Free Report) , Square (SQ - Free Report) , PayPal (PYPL - Free Report) , among others, appears as though it could slow down.
With that said, Apple’s less-talked-about “Other Products” unit, which features AirPods, Apple TV, Apple Watch, Beats products, and HomePod, surged 37% to reach $3.74 billion last quarter. Unfortunately, we do not have estimates for this particular segment, but it is worth keeping an eye on as it could remain Apple’s largest growth division.
Lastly, make to check in on some of Apple’s conference call notes to see if the firm has any updates on its streaming TV plans as it prepares to take on Netflix (NFLX - Free Report) , Amazon (AMZN - Free Report) , Hulu, and Disney (DIS - Free Report) .
Apple is scheduled to report its fourth quarter financial results after the closing bell on Thursday, November 1.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
Services Revenue, iPhone Sales & Other Key Q4 Apple (AAPL) Estimates
Shares of Apple (AAPL - Free Report) have slipped over 6% in the last month amid what has been a brutal October for tech stocks and the larger market. The iPhone giant could, however, turn things around when it releases its Q4 financial results on Thursday. So, it’s time to see what to expect from some of Apple’s key business units as they could move the needle, either way.
Apple Overview
Many people understand at this point that the massive success of the iPhone catapulted Apple into a unique stratosphere: the first publicly listed U.S. company to reach $1 trillion in market value. Apple CEO Tim Cook and other executives showed off the new iPhone XR, iPhone XS, iPhone XS Max, and the Apple Watch Series 4 at a product event last month to hype sales before the holiday shopping period.
And Apple wasn’t done there. The tech power is set to introduce new iPad Pros, its latest MacBook Air, along with a new Mac Mini and other devices at a launch event in Brooklyn Tuesday. These products and the newest crop of iPhones will hardly, if at all, show up on Apple’s fourth-quarter earnings results since its fiscal quarter ended on September 30.
Still, the hype surrounding the second product event in two months could help boost Apple stock ahead of Thursday’s earnings release. With that said, Apple and its shareholders know that the company has to continue to branch out beyond the iPhone and some of its other older product lines, which have struggled as of late. Apple has done this through a few different avenues on top of raising the cost of its flagship smartphone.
Apple is projected to see its adjusted Q4 earnings soar by 34.8% to reach $2.79 per share, based our current Zacks Consensus Estimate. Meanwhile, Apple’s total quarterly revenues are expected to climb by 16.95% to hit $61.49 billion. Now it's time to understand what to expect from some of Apple’s different business units.
To prepare for this, we can turn to our exclusive non-financial metrics consensus estimate file. The Zacks Consensus NFM file contains detailed estimate data for business segment metrics and non-financial metrics reported by companies. The data is acquired from digest and contributing broker models and includes the independent research of expert stock market analysts.
iPhone
Apple’s total iPhone unit sales are projected to climb less than 1% from 46.677 million in the year-ago period to 46.954 million, based on our latest NFM estimates. Luckily, the newer, higher priced phones, including last year’s 10th anniversary iPhoneX, looks poised to lift total iPhone revenues in a big way.
Apple’s Q4 iPhone revenues are projected to hit $35.651 billion. This would mark a roughly 23.5% climb from the fourth quarter of 2017’s $28.846 billion. Last quarter, iPhone unit sales rose marginally from 41.026 million to 41.300 million, while revenues jumped 20% to reach $29.906 billion.
Clearly, the iPhone is still Apple’s most important business unit, with it expected to account for roughly 58% of total quarterly revenues. But another Apple business segment is likely to grab even more attention Thursday.
Services
Wall Street has focused heavily on Apple’s expanding services business, which features iTunes, AppleCare, Apple Pay, and Apple Music. Our current NFM estimates are calling for services revenues to reach $10.546 billion. This would mark a 24% climb from the year-ago period’s $8.501 billion. Services would also account for just over 17% of total Apple revenues, based on our estimates.
It is worth noting that this would mark a slow down from services’ 31% growth in Q3 and 34% expansion in the year-ago quarter. Therefore, we should pay close attention to this figure when Apple reports as it could foreshadow how AAPL stock trades, especially in the near-term.
Bottom Line
We can see that iPhone revenues are expected to continue to surge despite slow year-over-year unit sales growth. At the same time, Apple’s services business, which aims to take on (SPOT - Free Report) , Square (SQ - Free Report) , PayPal (PYPL - Free Report) , among others, appears as though it could slow down.
With that said, Apple’s less-talked-about “Other Products” unit, which features AirPods, Apple TV, Apple Watch, Beats products, and HomePod, surged 37% to reach $3.74 billion last quarter. Unfortunately, we do not have estimates for this particular segment, but it is worth keeping an eye on as it could remain Apple’s largest growth division.
Lastly, make to check in on some of Apple’s conference call notes to see if the firm has any updates on its streaming TV plans as it prepares to take on Netflix (NFLX - Free Report) , Amazon (AMZN - Free Report) , Hulu, and Disney (DIS - Free Report) .
Apple is scheduled to report its fourth quarter financial results after the closing bell on Thursday, November 1.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>