Factors To Consider Ahead Of Apple's (AAPL) Q4 Earnings
Zacks Investment Research | Oct 28, 2019 11:09PM ET
Apple’s (NASDAQ:AAPL) non-iPhone segments — Services, Wearables, Mac and iPad —are expected to have benefited fourth-quarter fiscal 2019 results, scheduled to be released on Oct 30.
The Services business, which includes revenues from Internet Services, App Store, Apple Music, Apple Care, Apple Pay, and licensing and other services, has become the new cash cow for the company. Services revenues accounted for 21.3% of sales in third-quarter 2019.
Moreover, the Wearables business, which includes Apple Watch, Beats and AirPods, is expected to stay in the limelight. In the last reported quarter, revenues from these products accounted for 10.3% of sales.
Apple’s flagship iPhone sales declined in the last couple of quarters, a trend that most likely continued in the fourth quarter, due to stiff competition from Chinese handset makers and sluggish demand. Hence, the performance of these non-iPhone segments will be eagerly watched by investors to measure the success of Apple’s revenue diversification strategy.
sale on Sep 25.
However, given the short time span, the new devices are not expected to have contributed much to the iPhone and iPad top line in the fourth quarter.
The Zacks Consensus Estimate for iPhone revenues stands at $32.30 billion, implying a 13.1% decline from the figure reported in the year-ago quarter.
Moreover, the consensus mark for iPad revenues is pegged at $4.53 billion, indicating 10.7% growth from the figure reported in the year-ago quarter.
Meanwhile, Apple Arcade, a subscription-based gaming service, was also available from Sep 19 in more than 150 countries. Priced at $4.99 a month, the service starts with a free trial.
Moreover, the company announced that Apple TV+ will be launched on Nov 1 at $4.99 per month with a one-week free trial.
Further, on Aug 20, Apple launched its much-anticipated Apple Card in partnership with Goldman Sachs (NYSE:GS) as its issuing bank and Mastercard (NYSE:MA) as the global payments network.
Mac Sales Expected to Decline
The third-quarter results reflected Apple’s growing traction among enterprises, driven by collaborations with the likes of AT&T (NYSE:T) , IBM (NYSE:IBM) and SAP SE (DE:SAPG). The trend most likely continued in the to-be-reported quarter owing to an updated Mac and iPad portfolio.
However, despite a Zacks Investment Research
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.