Apple analysts: March quarter iPhone revenues expected to fall off a cliff

A pair of analyst surveys both predict a double digit drop in fiscal Q2 worldwide sales.

Visible Alpha: The consensus among the nine Wall Street analysts who have submitted estimates to Visible Alpha is that sales of iPhones in the March quarter (Apple’s fiscal Q2 2019) will come in at $32.93 billion, down 13.4% from the same quarter last year.

Apple 3.0: The estimates from the 15 analysts I’ve heard from so far—9 professionals and 6 independents—range from $28 billion to $37.5 billion. Average: $32.84 billion, down 13.7% year over year.

That feels like a consensus.

Below: The estimates of the 15 analysts that I have on record, pros in blue, indies in green. (Corrections appreciated.)

iphone estimates q2 2018

Click to enlarge. 

We won’t find out who was closest to the mark before Apple reports its March quarter results, which last year didn’t arrive before May. By then some of these estimates may have changed.

UPDATED Sunday with a couple of corrections.

11 Comments

  1. David Drinkwater said:

    Many estimates will undoubtedly change when Apple offers its guidance.

    0
    January 26, 2019
  2. Paul Brindze said:

    Am I missing something? These are iPhone only numbers. Isn’t Apple no longer reporting these separately, only total hardware and total services? If so, we will never really know which of these is most accurate. Am I incorrect?

    0
    January 26, 2019
    • Robert Paul Leitao said:

      Paul:

      Obviously next week we will know with certainty how Apple is choosing to report segment revenue moving forward. But no matter diminished iPhone sales expectations, the iPhone will represent in the range of 80% of major device line revenue in the period. It’s not possible to develop comprehensive estimates for the quarter without preparing estimates for the underlying revenue components.

      Publishing estimates from the independents and the pros is about much more than determining which analyst is closest to the mark on revenue estimates for each of the company’s revenue segments and much more about the different forecasting models deployed and the insights shared through conversation and ongoing analysis of the company.

      I wouldn’t consider an analyst’s work all that credible without an understanding of the methods deployed and the components used in assembling their aggregate revenue, net income and earnings per share numbers.

      0
      January 26, 2019
      • Gregg Thurman said:

        It’s not possible to develop comprehensive estimates for the quarter without preparing estimates for the underlying revenue components.

        I used to feel that way, but haven’t for quite some time.

        I rely exclusively on management’s guidance for the current quarter (current when guidance is given). Beyond the current quarter, I have tried to use unit growth history with poor results.

        Tweaking my model, to eliminate all unit sales references has resulted in a cleaner model, one that will be more informative in the future.

        0
        January 27, 2019
    • “Am I missing something? These are iPhone only numbers. Isn’t Apple no longer reporting these separately, only total hardware and total services?”

      From the Q4 transcript:

      “Third, starting with the December quarter, we will no longer be providing unit sales data for iPhone, iPad and Mac. As we have stated many times, our objective is to make great products and services that enrich people’s lives, and to provide an unparalleled customer experience so that our users are highly satisfied, loyal and engaged.”

      He didn’t say anything about revenue data. I assumed what meant Apple will still provide. We’ll find out next week.

      0
      January 27, 2019
      • Turley Muller said:

        It’s not going away. They will still report revenues. Apple wouldn’t have bothered with the reclassification of those segments and the renaming of Other Products if it weren’t going to disclose those revenue numbers for those categories. SEC requires disclosing revenue for segments 10% or more. Units are not required.

        0
        January 27, 2019
  3. Kathy Corby said:

    Baked in? Remember that Apple’s fall from its high of 233 to its low of 142 was a 39% drop. Even now, we remain 33% down from the highs. It makes the drop seem overdone, compared to a 14% drop in iPhone sales revenue, does it not?

    2
    January 26, 2019
    • Gregg Thurman said:

      I agree with you Kathy on the disconnect between the decline in iPhone revenue and the decline in share price.

      Discounting AAPL 14% from its all-time high by the decline in iPhone revenue percent results in a price of $200. My only concern about a $200 fair value target is that the decline in China occurred in the month of December. That’s one month out of three in the quarter. Is the decline a one-time event (December) or will it extend through the March quarter (three months) and beyond, and if it does, how long will the decline persist?

      The decline in China was caused by several factors (slowing Chinese economy, implementation of tariffs, currency exchange rate headwinds, the effect of the battery replacement program, etc). Focusing on a single factor is a mistake in my opinion.

      With respect to the battery replacement program, there are reports that there has been a surge in older iPhone activity. Could this activity surge be older iPhones (none older than iPhone 6), equipped with new batteries, returning to the market? If it is then the effective usable life of an iPhone is up to 5 years. Think of that, the aspirational value of an iPhone is such that people are buying 3 to 4-year-old iPhones instead of brand new Androids for the same money.

      0
      January 27, 2019

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