Apple Misses on Profit and Revenue Forecasts
Apple Inc., after market close this afternoon, on Thursday February 2nd, reported a decline in its revenue and profits. In the last quarter of last year, the company’s revenue fell 5% to $117.2 billion, which is considered a rare occurrence and a significant miss compared to the expectations of Wall Street analysts. The drop marks the first time in two years that the company has reported a decline in year-over-year revenue. The company’s profits also decreased more than 13% compared to the same quarter the previous year, reaching nearly $30 billion. Apple’s stock saw a decline of up to 4% in after-hours trading after the announcement of the disappointing earnings.
The decline in Apple’s earnings can be attributed to several factors, including a shutdown of a key Chinese factory, concerns of consumers reducing their spending on tech gadgets due to recession fears, high inflation, and interest rates. Despite the decline, Apple reported that its global installed base now reaches over 2 billion devices and its Services business, which includes Apple TV+ and gaming, reached an all-time quarterly revenue record of $20.8 billion, up 6% from the previous year. However, this represents a sharp slowdown in growth from the nearly 24% increase it posted a year ago.
Apple’s iPhone sales have underperformed and decreased by more than 8% compared to the previous year. This decrease in sales can be attributed to several factors such as increased competition, market saturation, and possibly changing consumer preferences. The decrease in iPhone sales has had a majorly negative impact on Apple’s overall revenue and profits for this quarter. The simple issue for Apple’s iPhone is that in this economic backdrop, few people will spend a thousand dollars on a phone, when they are struggling to pay for inflated mortgages and food.
AAPL Stock Forecast & Analysis
Apple Inc’s stock is being positively forecasted by analysts, with an average target price of USD 168.40 over the next 12 months. This average target price is based on the projections of 32 analysts. The average analyst rating for Apple Inc is “Strong Buy,” indicating a positive outlook on the company’s stock performance. Stock Target Advisor’s own analysis of Apple Inc is “Slightly Bullish,” which is based on a combination of 10 positive signals and 5 negative signals.
At the last closing, Apple Inc’s stock price was USD 145.43. The stock price has seen a change of +2.52% over the past week, +11.93% over the past month, and -16.71% over the past year. This suggests that the stock price has been generally increasing over the past week and month, but has experienced a decrease over the past year.
