When Apple reveals its first quarterly earnings report of 2017 next Tuesday, the company could shock us with another record-breaking quarter.
The Q1 2017 earnings will cover Apple’s first full quarter of iPhone 7 and iPhone 7 Plus sales, and Apple should also get a big boost from the holiday shopping season, according to some Wall Street estimates. During its last earnings call, Apple predicted its revenue slump will end as the company finally returns to growth this quarter, but will it be enough to satisfy investors?
Here’s what to expect from Apple’s January 31 earnings report.
$76 billion in Apple revenue
In Q1 2016, Apple reported revenue of $75.9 billion. Apple told investors it expected to pull in between $76 and $78 billion for Q1 2017. If Apple falls short of that, its stock will take a huge hit, but anything over $78 billion will be seen as a phenomenal success considering the lackluster hype behind the iPhone 7.
A return to growth for iPhone sales?
Apple has grown increasingly dependent on iPhone sales the last few years, and 2017 will be no exception. Sales started declining year-over-year in 2016, but some analysts predict Apple will return to growth this quarter.
Last year, Apple sold 75 million iPhones during Q1. Wall Street expects Apple to have sold at least 76 million iPhones in Q1 2017. Anything less would be a huge disappointment to investors, some of whom are already worrying that the next iPhone might not be huge hit either. (Spoiler alert: It’s gonna be yuuuuuge.)
MacBook Pro sales bump
Apple is unlikely to detail how many units of the new MacBook Pro it sold, but Phil Schiller claimed there were more pre-orders for the Touch Bar-equipped MacBook Pro than any MacBook in history. Overall Mac sales have been down for the last four quarters, so if the MacBook Pro is as big a success as Apple originally let on, it should provide a nice increase in sales.
Apple’s hopes for India and China
China hasn’t been growing quite as steadily as Apple hoped, which makes India a more important emerging market than ever. The company is reportedly finalizing a deal to bring some iPhone manufacturing to the country and get its foot in the door. Expect Tim Cook to talk about the challenges Apple is facing in both markets.
Services
With iPhone growth slowing, Apple is turning more to services like iTunes, Apple Music and iCloud to make up the difference. The services segment has become the second-largest revenue generator for Apple the last three quarters. If Apple reports more revenue than expected, it will likely be partly thanks to its budding services business.
