Apple Q2 Earnings Tomorrow: Here’s What Investors Are Watching Out For

Consumer electronics giant Apple (AAPL) is heading into its second-quarter earnings results on April 30th with its shares almost flat year-to-date. Analysts expect an earnings beat and will likely anticipate updates on its AI strategy, plans for soaring memory chip prices, and CEO transition.

What Wall Street Expects

During the three-month period that ended on March 28, Apple’s revenue is projected to have grown by roughly 15% year-over-year to $109.46 billion. Its earnings per share are also expected to climb by 18% to $1.95.

Key Catalysts on Investors’ Radar

1. iPhone sales momentum: Apple’s iPhone smartphone remains the company’s biggest revenue generator. The release of the iPhone 17 series has been met with strong customer demand. Apple led in global smartphone shipments in the first quarter of this year, ahead of rivals, including Samsung (SSNLF), even as overall shipments by smartphone manufacturers fell by 6% year-over-year due to chip shortages. UBS analyst David Vogt sees Apple posting a slight earnings beat for the quarter, with modest contributions from the demand for iPhones and the Mac computer line. Vogt sees iPhone revenue coming in at $56.2 billion in the quarter despite supply chain challenges — this will mark a 20% growth from $46.84 billion in the same quarter last year.
2. Memory chip price pressure: Soaring memory chip prices have emerged as a key challenge for smartphone makers, especially those that manufacture Android devices. While Apple continues to grow its smartphone market share despite the supply constraints, Vogt is not completely confident of the road ahead. He maintained his neutral rating on AAPL, expecting higher memory costs to impact profit margins. On the contrary, Evercore ISI’s Amit Daryanani contended that Apple has “several internal levers” to offset the impact from surging prices. Daryanani reaffirmed his Buy rating on AAPL and set a price target of $330, implying about 22% upside.
3. Delayed Siri Launch: Apple’s spring product refresh failed to capture significant investor attention, as analysts are waiting for more updates on its AI strategy. Investors will be looking for more answers on the delayed launch of an advanced, AI-powered Siri digital assistant and AI overhaul of the iPhone.
4. CEO transition: Long-time executive John Ternus is set to replace Tim Cook as Apple CEO. While analysts are bullish on the appointment, investors will expect to hear more about Apple’s post-Cook plan.

Is Apple stock a good stock to buy?

Across Wall Street, analysts’ consensus rating on Apple’s shares remains a Moderate Buy. This is based on 17 Buys, nine Holds, and one Sell recommended by 27 analysts over the past three months.

However, the average AAPL price target of $299.80 suggests about 11% upside in the months ahead.