Proactive Investors - Apple Inc (NASDAQ:AAPL, ETR:APC) is seen topping Wall Street analyst estimates for the fiscal third quarter but investor focus will be on the iPhone maker’s outlook, according to Bank of America (NYSE:BAC) analysts.
Ahead of Apple’s earnings, due after the closing bell on Thursday, August 1, the analysts wrote in a note to clients that they believe investors will mostly ignore the company’s Q3 results and focus more on commentary related to upcoming AI-enabled iPhones.
Revenue and market share growth in China and Services revenue growth will also draw focus.
“We see pent-up demand and a meaningful number of older iPhones in the installed base, and the new AI features should help drive an upgrade cycle,” they wrote.
“Given the staggered rollout of Apple Intelligence across regions, we expect the US to be the first to upgrade and then EU/China to follow later in the cycle.”
They see Apple posting revenue of $84.5 billion and earnings per share of $1.35 for Q3, slightly above the Street’s estimates of $84.4 billion and $1.34, respectively.
Services growth is expected to be 14% year-over-year on strong growth in App Store, Licensing, iCloud, and subscriptions.
Looking ahead to the September quarter, fiscal Q4, analysts see 55 million in iPhone sales, above the Street at 50.7 million.
Revenue is pegged at $98.6 billion and EPS at $1.63, compared to the consensus of $94.6 billion and $1.56, respectively.
In 2025, the BofA analysts see upside for iPads, Macs and wearables coming off weaker spend cycles and from product refreshes.
They repeated their ‘Buy’ rating and $256 price target on their expectation Apple will benefit from GenAI at Edge with gross margin upside and momentum in Services.
Apple shares (NASDAQ:AAPL) traded at $218 on Monday afternoon.