Nosebleed territory: An Earnings Smackdown winner (Q3 2017) just posted the industry-high Apple revenue estimate.
From Thursday's note to Above Avalon subscribers:
- Revenue: $95.6B (guidance: $84B to $87B)
- Gross Margin: 38.6% (guidance: 38.0% to 38.5%)
- EPS: $4.49 (consensus: $3.80)
- iPhone: 82.0M (up 5%)
- iPad: 14.9M (up 14%)
- Mac: 5.9M (up 10%)
- Apple Watch: 10.2M (up 80%)
- Services: $8.2B (up 14%)
- Other Products: $5.9B (up 45%)
- Buyback: 50M shares repurchased
We will begin today's discussion with the elephant in the room - my revenue estimate. For the past two years, Apple has reported earnings that are roughly in-line with its guidance... Meanwhile, my $95.6M revenue estimate for 1Q18 exceeds the top end of Apple's guidance range by $8.6 billion. What is going on here? As we discussed this past Tuesday, my revenue estimate reflects very strong iPhone X sales driving iPhone ASP to an all-time record.
My take: I'm still gathering December quarter numbers for Apple, but I can tell you that Cybart's estimate of 82 million iPhones is middle-of-the-road. It's those 10.2 million Apple Watches and, especially, his $826 iPhone ASP that have pushed him into nosebleed territory.
If Apple reports explosive 1st quarter revenue growth and provides strong 2nd quarter guidance, almost every Apple analyst loses the last of their already low reputation. Is it 2/1 after the bell yet.
For an Apple Long, these lies MUST be addressed and with the truth of our record breaking financial performance.
I agree, that’s why I am taking this as a gift and adding new long positions.