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Apple expects Mac revenues to significantly accelerate compared with the September quarter’s reported figure.
For the Services segment, Apple expects average revenues per week to grow at a similar strong double-digit rate as it did during the September quarter.
The Zacks Consensus Estimate for fiscal first quarter Mac revenues are pegged at $7.77 billion, indicating 0.4% year-over-year growth.
Mac revenues are expected to have benefited from improvement in PC demand. Per Gartner’s latest report, 63.3 million PCs were shipped in the fourth quarter of calendar 2023, up 0.3% from the year-ago period.
Shipments from Acer, Apple, Lenovo (LNVGY - Free Report) and HP (HPQ - Free Report) gained 11.1%, 7.2%, 3.2% and 5.6%, respectively. Dell Technology’s (DELL - Free Report) shipments declined 8.3%.
Overall, Lenovo remained the top vendor, with a market share of 25.6%. HP held the second spot, with a market share of 22% in worldwide PC shipments. Dell’s market share was 15.8% in the fourth quarter of 2023.
Apple’s market share increased from 9.4% in fourth-quarter 2022 to 10% in fourth-quarter 2023.
Click here to know how Apple’s overall fiscal first-quarter results are likely to be.
Steady Services Growth to Aid Top Line
Apple’s Services business is expected to benefit from increasing user of the App Store and growing viewership of Apple TV+. Moreover, growing adoption of Apple Music, Apple Arcade, Apple News+ and Apple Card has been noteworthy.
Although Apple’s business primarily runs around its flagship iPhone, the Services portfolio has emerged as the company’s new cash cow. It accounted for 24.9% of sales in fourth-quarter fiscal 2023.
Apple had more than 1 billion paid subscribers across its Services portfolio at the end of the fiscal fourth quarter. This is expected to have increased in the to-be-reported quarter, thanks to the growing installed base of Apple’s devices as well as the popularity of apps like Apple TV+.
The Zacks Consensus Estimate for first-quarter fiscal 2024 Services revenues is $23.398 billion, indicating 12.7% year over year.
iPad & Wearables Sales to Decline
Apple expects the year-over-year revenue growth for both iPad and Wearables, Home and Accessories to decelerate significantly from the September quarter due to a different timing of product launches.
The consensus mark for iPad revenues is pegged at $6.769 billion, indicating 28% year-over-year decline.
The Zacks Consensus Estimate for Wearables, Home & Accessories revenues of $11.271 billion, suggesting 16.4% year-over-year growth.
Image: Bigstock
Apple's (AAPL) Q1 Earnings to Ride on Solid Mac Sales, Services
Apple’s (AAPL - Free Report) first-quarter fiscal 2024 results, to be reported on Feb 1, are expected to reflect improving PC market, as well as steady growth in the Services business.
Apple expects Mac revenues to significantly accelerate compared with the September quarter’s reported figure.
For the Services segment, Apple expects average revenues per week to grow at a similar strong double-digit rate as it did during the September quarter.
The Zacks Consensus Estimate for fiscal first quarter Mac revenues are pegged at $7.77 billion, indicating 0.4% year-over-year growth.
Mac revenues are expected to have benefited from improvement in PC demand. Per Gartner’s latest report, 63.3 million PCs were shipped in the fourth quarter of calendar 2023, up 0.3% from the year-ago period.
Shipments from Acer, Apple, Lenovo (LNVGY - Free Report) and HP (HPQ - Free Report) gained 11.1%, 7.2%, 3.2% and 5.6%, respectively. Dell Technology’s (DELL - Free Report) shipments declined 8.3%.
Apple Inc. Revenue (TTM)
Apple Inc. revenue-ttm | Apple Inc. Quote
Overall, Lenovo remained the top vendor, with a market share of 25.6%. HP held the second spot, with a market share of 22% in worldwide PC shipments. Dell’s market share was 15.8% in the fourth quarter of 2023.
Apple’s market share increased from 9.4% in fourth-quarter 2022 to 10% in fourth-quarter 2023.
Click here to know how Apple’s overall fiscal first-quarter results are likely to be.
Steady Services Growth to Aid Top Line
Apple’s Services business is expected to benefit from increasing user of the App Store and growing viewership of Apple TV+. Moreover, growing adoption of Apple Music, Apple Arcade, Apple News+ and Apple Card has been noteworthy.
Although Apple’s business primarily runs around its flagship iPhone, the Services portfolio has emerged as the company’s new cash cow. It accounted for 24.9% of sales in fourth-quarter fiscal 2023.
Apple had more than 1 billion paid subscribers across its Services portfolio at the end of the fiscal fourth quarter. This is expected to have increased in the to-be-reported quarter, thanks to the growing installed base of Apple’s devices as well as the popularity of apps like Apple TV+.
The Zacks Consensus Estimate for first-quarter fiscal 2024 Services revenues is $23.398 billion, indicating 12.7% year over year.
iPad & Wearables Sales to Decline
Apple expects the year-over-year revenue growth for both iPad and Wearables, Home and Accessories to decelerate significantly from the September quarter due to a different timing of product launches.
The consensus mark for iPad revenues is pegged at $6.769 billion, indicating 28% year-over-year decline.
The Zacks Consensus Estimate for Wearables, Home & Accessories revenues of $11.271 billion, suggesting 16.4% year-over-year growth.
Apple currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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