All signs point to Apple announcing a monster earnings report (AAPL)
Apple reports earnings for the quarter that ended in March after the market closes on Monday, April 27.
Get ready for another monster report.
Analysts are expecting big iPhone sales and think Apple could provide a major update to its cash return program.
According to data compiled by Bloomberg, analysts are looking for $56 billion in revenue, which would represent 23% growth.
Apple's revenue growth is expected to be driven by strong iPhone sales. Analysts are anticipating that Apple sold 58.1 million units, which would be an impressive 33% increase.
If Apple sells 58.1 million iPhones, it will be the second-biggest quarter for iPhone sales in Apple's history.Apple's biggest-ever iPhone sales happened during the previous quarter, when it sold 74.5 million iPhones.
Just a year ago, people were thinking that Apple's iPhone business might have run its course. Unit growth was down to single digits, and it looked like Apple was going to have to lower prices to reignite growth.
The newest iPhones are proving to be killers for Apple. The iPhone 6 and iPhone 6 Plus have bigger screens than previous models, which is all it took to make Apple's iPhone sales go nuclear.
Apple has effectively raised prices on the iPhone. The iPhone 6 Plus costs $100 more than previous models. The iPhone 6 costs just as much as prior models, but many people are gravitating towards the mid-tier storage model, which costs $100 more than the entry-level phone.
Apple has failed to provide any sort of clear explanation for why the iPad business has cratered. The best explanation seems to be that people are skipping the iPad in favor of iPhones with large screens. The Mac business is also doing well. Analysts expect Apple to sell 4.7 million Macs, which would be up 15%. (So an iPhone + a Mac seems to cutting into iPad sales.)
However, Apple has already said it's not going to break out Apple Watch sales. Apple may be willing to make a one-time announcement about how many watches it sold, but we aren't expecting anything.
As for Apple's cash program, there's been chatter that Apple could provide an updated plan on what it's doing with dividends and buybacks.
Last year, Apple announced a $130 billion program to return cash to shareholders. Credit Suisse analyst Kulbinder Garcha thinks that plan gets increased to $200 billion this year. Apple had $155 billion in cash on hand last quarter, so it makes sense to enact a massive share buyback/dividend plan.
We'll be covering it live as it happens, so tune in around 4 p.m. NYC time on Monday.
Until then, here are the key numbers to watch, via Bloomberg:
- EPS: $2.14
- Revenue: $55.96 billion
- iPhone units: 58.1 million
- iPad units: 13.6 million
- Mac units: 4.7 million
- iPhone ASP: $656
- iPad ASP: $418
- Q3 revenue: $46.93 billion