Apple Sales Slump Set to Continue, but Many Investors Remain Bullish

livemint.com:

Apple is expected to announce its third consecutive quarterly decline in revenue on Thursday after markets close, the company’s most prolonged sales slump since 2016, although many investors remain confident the struggles will be temporary. That kind of revenue dip hasn’t happened at Apple in about seven years, when it ended its fiscal 2016 with sales down 7.7% annually, mostly due to declining iPhone sales. The same phenomenon is behind Apple’s slump in 2023, although investors and analysts now see a different company.

The iPhone currently accounts for roughly half of Apple’s overall sales, compared with nearly two-thirds of revenue in 2016. Investors largely believe that Apple has become a diversified enough company to handle a stagnating iPhone business. The tech giant is expected to close out 2023 with revenue declining 2.6% from the previous year.

Apple’s next major iPhone upgrade—likely called the iPhone 15—is expected in September, typical of the company’s annual hardware launch cycle. July expectations Revenue for the three-month quarter ended in July is expected to be $81.8 billion, down 1.4% from the prior year, according to analysts polled by FactSet. Net income is expected to be $18.8 billion, a decline of 3.4% from Apple’s earnings the same quarter a year ago.

China, Apple’s third largest market, is expected to see a 6.7% annual decline in revenue to $13.6 billion. iPhone sales are expected to decrease about 1% annually to $40.2 billion, roughly half of Apple’s total revenue. Investor faith Even with declining iPhone sales, investors continue to support Apple, believing the company will find a way to maintain and grow its dominant position in consumers’ lives.