Apple (AAPL) will report first quarter results tonight after the close. There is a conference call scheduled for 17:00 ET. The company warned on Q4 revs earlier this month. 

Apple said Q1 revenues will be $84 billion versus $89-93 billion prior guidance.

Capital IQ consensus calls for Q1 EPS of $4.17 (versus $3.89 last year) on revenue of $84.0 bln (-5% YoY).

The Street is looking for Q1 gross margins near 38% vs 38.4% last year.

Since the company pre-announced, the key item of note will be Q2 guidance.  

Q2 Capital IQ consensus calls for $59.0 billion (-3.4% YoY). Consensus was $64.8 billion two months ago. 

Apple will no longer provide unit sales for iPhones, iPads, or Macs. They will be providing services gross margin for the current quarter. Expectations are that services gross margin will be near 63%.

TECHS:

AAPL has a $740 billion valuation and trades at 13x FY19 EPS.

Based on the AAPL Feb01 $156.5 straddle, the options market is currently pricing in a move of ~6% in either direction by tomorrow.

Suppliers to Keep on Watch: 

SSNLF, LPL (for displays) and LITE, FNSR and IIVI (for FaceID.) Other suppliers include: SWKS, CRUS, AVGO, QRVO, TSM, and QCOM, among others. (SMH)

RESULTS:

  • Apple reports Q1 gross margin of 38.0% versus ests of 38.0% (in line with pre-announcement); sees Q2 gross margins 37-38% versus 38.1% ests and 38.3% last year  

  • Co reports Q1 services gross margin of 62.8% versus 63% ests.

  • Apple prelim Q1 $4.18 vs $4.17 S&P Capital IQ Consensus Estimate; revs $84.3 bln vs $84.00 bln S&P Capital IQ Consensus Estimate

  • Apple sees Q2 revs $55-59 bln vs $58.97 bln S&P Capital IQ Consensus Estimate

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