Shares of Apple have been slumping quite a bit lately. After reaching an all-time high of $137/share in July, Apple’s stock price embarked on a slow and steady decline. Today, Apple shares are currently trading at sub-$100 levels, giving the company a rather shockingly low P/E ratio of 10.8. In stark contrast, Google and Amazon’s respective P/E ratios check in at 33 and 865.
At the core of Apple’s stock drop are concerns regarding iPhone sales. Indeed, many analysts believe that Apple in 2016 will report its first year over year drop in iPhone sales in company history. With Apple set to report earnings for its most recent holiday quarter later today, Apple shares are currently poised to either rebound dramatically or drop off even more drastically.
To help you prepare for Apple’s earnings announcement this afternoon, we’ve provided a quick little primer detailing which details, above all others, are worth paying attention to.
Of course, the key thing to pay close attention to is iPhone sales for the quarter. During Apple’s last holiday quarter, the company sold 74.5 million iPhones, setting an all-time quarterly sales record in the process. One year later, Wall Street analysts are anticipating iPhone sales to check in at 76.5 million units, a rather modest increase year over year.
But 2015’s holiday quarter aside, what analysts will pay even closer attention to is Apple’s iPhone sales projection for its March 2016 quarter. During the company’s March 2015 quarter, the company sold 61.2 million iPhones, so it’ll be interesting to see how the March 2016 quarter is looking from Apple’s vantage point.
On the financial side of the equation, Apple a year-ago posted revenue of $74.6 billion and a quarterly net profit of $18 billion, resulting in earnings of $3.06 per share. Ahead of Apple’s earnings announcement this afternoon, analysts are anticipating that Apple will post revenue of $76.6 billion, a quarterly net profit of $18.2 billion, and earnings of $3.23 a share. As for the discernible jump in EPS, that’s the result of Apple’s aggressive stock buyback plan. All that said, Apple will likely set new records for quarterly revenue and iPhone sales, just barely.
As for other sales metrics, here’s how Apple’s product lineup performed during the company’s 2014 holiday quarter: 21.4 million iPads sold, 5.5 million Macs sold, and about $4.8 billion in revenue from various services, including the iTunes Store, App Store, Apple Pay, and the Mac App Store.