For the first time in two decades of pinpoint Apple prognostication, Daniel (“deagol”) Tello has thrown in the towel.
From “Skipping Detailed Quarterly Estimates for Rest of FY 2020” posted Friday on deagol’s AAPL Model:
I have no way of figuring out the impact to global demand from various COVID-19 containment and mitigation policies in over 130 countries, neither today nor in a month when I would normally publish these estimates. In fact, I don’t think even Apple itself can, so I’m not expecting them to provide guidance for next quarter.
I don’t think Chinese manufacturing was significantly affected beyond a month or so, but the worldwide network of component supply dependencies and the demand uncertainty probably means Apple should be cautious in ramping production of existing and new products until most of the world has gone through this disruption. The flip side is a likely boost to Services revenue and possibly overall margins so long as HW product margins are not affected too much. Also, since demand is not destroyed but postponed, the rebound next year should be quite impressive, even bleeding into 2022.
In light of this unique situation, for the first time in two decades I will not be able to share detailed estimates for Q2 or Q3 guidance, but will stick with projections for FY21 and beyond, at least until we hear more from Apple. For the valuation model I’m holding the trailing numbers roughly flat until Dec, which is probably not far from what might actually happen.
Below: Tello’s current forecast, as detailed as he can make it…
My take: With Turley Muller dead and Tello bowing out, my quarterly Earnings Smackdown for 2020 has lost two of its best.