Apple will announce its fiscal third-quarter earnings on Thursday, July 28. In his latest Power On newsletter, Bloomberg’s Mark Gurman says Apple is being affected by global economic concerns, but should bounce back fairly quickly.
Analysts predict that third-quarter revenue will climb by about 2% from a year earlier, the slowest pace since 2020. That compares with the 36% jump that Apple saw in the third quarter of 2021. Revenue is expected to come in around $82.7 billion. Gurman writes that Apple’s challenges go beyond the latest economic concerns:
° First, the company already said you can shave $4 billion to $8 billion off the top of last quarter because of supply problems stemming from Chinese lockdowns and the chip shortage.
° Second, it’s a tough comparison. The third quarter of 2021 included a lot of pandemic-induced spending by people outfitting their home offices. That led to a nice jump in Mac and iPad sales.
° Third, though the latest MacBook Air was announced during the third quarter, it wasn’t released until the fourth quarter. Many customers held off buying a MacBook Air—Apple’s most popular Mac—while they waited for the new model to arrive.
° Then there’s the economy. Given all the uncertainty, more people are probably holding on to their cash right now instead of spending on new Apple products. If they do splurge on technology, they may wait for the latest iPhone, AirPods Pro, Apple Watch and iPad to arrive this fall.
However, Gurman thinks Apple will bounce back quickly because of a flood of new products: four iPhone 14 models; a new Apple Watch SE, Apple Watch Series 8, and high-end “Pro” Apple Watch; an updated HomePod; a new Apple TV; updated iPad Pro models with an M2 chips; a new low-end iPad with a USB-C port; revamped Mac Pro with M2-based chip; a mixed-reality headset; a 15-inch MacBook Air; new M2 and M2 Pro Mac minis; updated AirPods Pro earbuds; new 14-inch and 16-inch MacBook Pros with M2 and M2 Pro processors.
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