Tomorrow afternoon after the bell closes, Apple will post its earnings results for the recent September quarter. Because Apple’s fiscal year ends in September as opposed to December, tomorrow will not only give us a little bit of insight into how the iPhone 7 is doing, it will also provide us with a complete picture of Apple’s finances over the last year.
Interestingly, because Apple experienced two consecutive quarters of iPhone sales declines this year, 2016 will likely mark the first time in 15 years that Apple will report a year-over-year decline in annual revenue.
Touching on this topic, VentureBeat relays that Apple’s revenue for its fiscal 2016 will likely land somewhere in the $215 billion range. By way of comparison, Apple in 2015 posted revenue of $233.72 billion, marking a year-over-year decline of 8%.
Still, it’s incredible to think one has to go all the way back to 2001 to find any decline, when the company reported $5.36 billion in revenue, down from the $7.98 billion revenue it reported in 2000. That’s also a reminder of just how puny Apple was at that point: The drop in annual revenue for 2016 could be about three times Apple’s total revenue in 2001.
All that said, it’s not as if investors are exactly worried. On the contrary, shares of Apple are trading at a level we haven’t seen since 2015, bolstered in large part by better than anticipated iPhone 7 sales, an upcoming revamp to Apple’s Mac line and, last but not least, what will likely be an iPhone 8 with a radical new redesign.
When Apple posts its earnings results tomorrow, there will be two items in particular worth keeping an eye on. One, it will be interesting to see if revenue from Apple’s services division continues to impress. Apple of course derives the bulk of its revenue from hardware, but thanks to the ongoing success of the App Store and continued growth the company is seeing with Apple Music, Apple’s services division is fast becoming a balance sheet item worth paying attention to. And two, and more importantly, Apple’s earnings guidance for the company’s upcoming holiday quarter will be important to keep tabs on.