Apple is set to post a rare revenue decline as the focus turns to recovering demand
February 1 (Reuters) – Apple Inc ( AAPL.O ) is expected to report its first drop in quarterly revenue in nearly four years after tough COVID-19 restrictions in China hit the economy and shutdown iPhone production at its biggest supplier, Foxconn. 2317.TW).
Investors will be looking for details on how Chief Executive Tim Cook is trying to boost demand in a weak economy that has led to massive layoffs in the tech industry.
Cowen analyst Krish Sankar said he expects 2% fewer iPhone units to be sold in 2023: “With supply chain issues largely normalized, we now Apple“We believe that due to macro factors, is entering a slower demand period,” he said.
According to Refinitiv, the world’s largest public company’s iPhone sales on Thursday are very important holiday is expected to report a decrease of about 5% in the quarter. Last time iPhone sales 2020In the August-October period, it decreased during the months of the COVID-19 pandemic.
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UBS analysts iPhone sales USAexpected to do better than China and Europe in , as economies recover from COVID-19 and Russia–Ukraine withdraws from the effects of the war.
BofA analyst Wamsi Mohan said some iPhone demand will pick up in the current quarter after supply constraints in the first quarter, and some demand will be lost due to product unavailability during the holiday period.
Which is the main development engine for the company and Apple‘s music and video streaming services hosting services business holiday is set to post its slowest revenue growth for the quarter – another result of consumers restraining spending.
Reuters Graphics Reuters GraphicsTHE CONTEXT
An outage at the world’s largest iPhone factory in Zhengzhou, China prompted a rare warning from Apple in November that delayed product launches and holiday led to limited supplies of the high-end iPhone 14 models, which are usually the biggest sales quarter in days.
Greater China, including Hong Kong, is key to Apple’s fortunes, accounting for about a fifth of annual revenue. California-based tech behemoth Cupertino, China-USA reiterated its overall sales forecast in 2019 due to the economic slowdown in the country following the trade war.
However, analysts expect a faster recovery this time as factories in China restart and Apple diversify its manufacturing footprint with factories in India.
“Commentary from luxury goods companies shows China is picking up fast, implying better-than-expected iPhone sales in China in the March quarter,” Evercore ISI analysts said in a note.
THE BASICS
** Revenue is estimated to have declined 2% in the final three months of Apple’s first fiscal quarter of 2022.
** iPhone sales 2020decreased for the first time since , and the service business increased by 6%.
** Analysts net income 10they expect to decrease by .4%; earnings per share $1.94
** Apple shares are down about 27% in 2022 and in January approx 10% gained value
WALL STREET SENTIMENT
** Since October, analysts have lowered some forecasts for Apple for the first quarter
Reporting by Nivedita Balu and Akash Sriram in Bengaluru; Edited by Sayantani Ghosh and Sriraj Kalluvila
Our standards: Thomson Reuters Trust Principles.
2023-02-02 01:17:27
Source – reuters
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