Setting the Stage for Apple’s 2Q24 Earnings, Thoughts on Apple’s Stock Price Underperformance

Hello everyone. Happy last day of April. We will begin preparing for Apple earnings. Today’s discussion will look at the big picture ahead of Thursday’s earnings release. We will go over my granular estimates on Wednesday.
 
Setting the Stage for Apple’s 2Q24 Earnings

Heading into Thursday’s earnings, the setup looks positive for Apple. Expectations surrounding Apple are at a multi-year low while business fundamentals appear to be holding up OK. This lowers the bar for what Apple needs to report and say on Thursday to please analysts and company observers. While a slowdown in device upgrading and sales weakness at the low end of various product lines continue to weigh on Apple’s

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Initial Thoughts on Apple’s 1Q24 Results, Apple’s 1Q24: By the Numbers, Parsing Apple’s 2Q24 Guidance

Apple’s 1Q24 earnings call was jam-packed with information. Unlike the average earnings call from Big Tech, Apple’s calls contain useful commentary and tidbits. More time will be needed to go through the disclosures, including the installed base information.

For today, we will look at the big picture from earnings, how the reported figures compared to my estimates, and Apple’s 2Q24 guidance.

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Reading Between the Lines of Apple’s 1Q23 Earnings Q&A With Analysts (Daily Update)

Hello everyone. Welcome to a new week.

Last Friday, we went over the numbers from Apple’s 1Q23 earnings release. We also looked at two of the major themes from earnings: the significant FX impact on Apple’s results and changing device upgrading trends.

In today’s update, we will focus on Apple’s 1Q23 earnings Q&A session with analysts. Instead of just recapping the question and answer exchanges that occurred on Apple’s call, we will go over Neil’s thoughts / response to each exchange. This will allow Neil to go beyond what was talked about on the call. Let’s jump right in.

Reading Between the Lines of Apple’s 1Q23 Earnings Q&A With Analysts

NOTE: The following earnings call questions (“Q”) and answers (“Cook” or “Luca”) have been cut, summarized, paraphrased, and rearranged for clarity. To read the full question and answer exchanges, The Motley Fool offers a written transcript here.

Supply Chain

Q: What is the state of Apple’s supply chain? Do you expect to increase inventory levels to insulate from supply disruptions?

Cook: Production is now back to “what we need it to be.” We continue to optimize our supply chain. We now have final assembly for iPhone in three countries. Given all that has happened over the past three years, our supply chain has proven to be resilient.

My response: Apple received a variation

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Final Thoughts Heading Into Apple Earnings, Spotify Earnings (Daily Update)

Hello everyone. On Monday, we went over my expectations heading into Apple’s earnings tomorrow. We also talked briefly about my thoughts on what Apple may say about FY2Q23. Yesterday’s update included my granular financial estimates and updated Apple earnings model. One item that has been on my mind is that noise found with tomorrow’s earnings may drown out the numbers and topics that should grab attention. In today’s update, we go over those key earnings items to keep an eye on tomorrow. The discussion then turns to Spotify’s 4Q22 earnings.

Final Thoughts Heading Into Apple Earnings

One item that has been on my mind is that noise found with tomorrow’s earnings may drown out the numbers and topics that should grab attention.

  1. iPhone strength. As alluded to in yesterday's update, earnings recap headlines will probably be focused on

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My Initial Reaction to Apple Earnings, Apple 4Q22: By the Numbers, Breaking Down Apple’s Guidance (Daily Update)

Today’s update will be dedicated to going over Apple’s 4Q22 results and management commentary. The idea is to keep things broad today and look at the big picture, in addition to the financial results. The discussion will continue next week as we move beyond the numbers to look at the granular takeaways.

My Initial Reaction to Apple Earnings

Apple went into this earnings season possessing the most formidable ecosystem of devices and services in the world. Despite facing major FX headwinds, Apple’s ecosystem remained on track in 4Q22. The company reported all-around solid 4Q22 results. The few areas of weakness (iPad and Services came in below my expectations) were offset by iPhone, Mac, and Apple Watch sales strength.

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