Summary: Apple is expected to report its 4Q 2022 earnings on Thursday, with analysts predicting a revenue decline for the first time since 2019 due to issues with its Chinese assembly plant during Covid restrictions and a global decrease in smartphone shipments. Analysts expect a rebound in 2023, with more than $98 billion worth of products expected to be sold in 1Q 2023 and the company’s services business providing stability for investors.
Apple is reporting its fourth quarter earnings on Thursday this week and analysts are expecting the iPhone maker to post a revenue decline. If Apple does post a decline, it would be the first time it is doing so since 2019.
One of the reasons analysts believe that there could be a revenue decline at Apple during the last quarter of 2022 is because of the crisis that plagued its Chinese assembly plant during the Covid restrictions. Unlike before, the company could not deliver the new iPhone 14 by Christmas day.
Refinitiv analysts expect the company to report a revenue of about $121 billion during that period. It had made $123.9 billion in the same period in 2021.
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Beside the problem with production, the global smartphone shipment also took a nosedive during that quarter. While Apple also sells laptops, that business provided no succor as the PC market fell even more than its smartphone counterpart.
According to a CNBC report, Apple is expected to report an earnings per share of $1.94, $68.29 billion revenue on iPhone, $7.76 billion on iPad, $9.63 billion on Mac, $15.26 billion on other products, and $20.67 billion on services.
However, with its issues mostly put to bed, analyst expect that Apple would sell more than $98 billion worth of products in the first quarter of 2023. Also, the company’s services business is providing a safe haven for its revenue and investors are advised to make their bets on it.
With several streaming deals being lined up for Apple TV+, it could be a real money maker for investors in the later part of this year.
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