Ahead of Apple's fiscal 2022 Q4 earnings call on October 27, Morgan Stanley believes that Apple's September quarter results will exceed Wall Street expectations, although the agency slightly reduced Apple's stock price. target price.
In a note to investors, Morgan Stanley analysts took a cautious view of Apple's financial performance. However, they expect the company to report revenue growth.
Erik Woodring forecasts Apple's September quarter revenue of $90.1 billion. The estimate beat Wall Street's forecast of $88.4 billion by 2% and, if accurate, would shatter the quarter's record.
As the year draws to a close, Woodring forecasts Apple's December quarter revenue to hit $133.7 billion. It also beat Wall Street expectations, which averaged 4% higher.
The combination of the iPhone, iPad and Mac will likely be the main factor driving Apple's growth. As of October 18, delivery times for the iPhone 14 Pro and iPhone 14 Pro Max reached 26.5 days.
Morgan Stanley forecasted shipments of 51.1 million iPhones in the September quarter with an average selling price of $838, which could bring in $43 billion in iPhone revenue.
iPad revenue is expected to be flat with last year at $8.3 billion, with roughly 16 million units shipped, while Mac revenue is likely to be $1.04 billion, up 14% year over year. Mac shipments in the September quarter are forecast at 8 million units.
Analysts are forecasting wearables quarter-over-quarter growth of +7% in September but below the average seasonal revenue of the past five years of +15%. The new Apple Watch Series 8, Apple Watch Ultra, and AirPods Pro may not be enough to drive significant revenue growth.
Finally, Woodring forecasts revenue of $19.7 billion for Apple Services. It believes that these factors, combined with Apple's 14-week quarter in December, will drive revenue from Apple's services business to accelerate year-over-year.
Morgan Stanley has slightly lowered its price target on Apple's AAPL stock to $177 from $180 in July 2022.
The decline in wearables and services may have contributed to the lower target price. In addition, the note mentioned that App Store revenue was down about 2% year over year, which Morgan Stanley attributed to the decline in gaming revenue.
0 Comments