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Going into Apple Earnings

Going into Apple Earnings Blog Title: Apple Earnings: What Our Experienced Traders Are Saying!


Apple is expected to report its earnings for the third quarter of fiscal 2023 on August 3, 2023, after market close. The consensus EPS forecast for the quarter is $1.19, which would represent a decline of 1% from the same quarter last year. Revenue is expected to come in at $74 billion, which would be a decline of 10.8% from the prior year.

The decline in earnings and revenue is being attributed to a number of factors, including the ongoing chip shortage, the war in Ukraine, and rising inflation. However, Apple is still expected to report strong results, and the stock is likely to rise in the wake of the earnings report.

Here are some of the key things to watch for in Apple's earnings report:

  • iPhone sales: iPhone sales are expected to decline in the third quarter, but they are still expected to be the company's largest source of revenue.

  • Services: Services revenue is expected to grow in the third quarter, driven by strong growth in Apple Music, iCloud, and Apple Pay.

  • Mac and iPad sales: Mac and iPad sales are expected to decline in the third quarter, but they are still expected to be strong contributors to revenue.

  • Margins: Apple's gross margins are expected to remain strong in the third quarter, despite the challenges facing the company.

  • The earnings call will be held at 5:00 PM PT on August 3, 2023.

  • The call will be webcast live and can be accessed on Apple's investor relations website.

  • The earnings press release will be released after the market close on August 3, 2023.

As one of the largest companies in the world, Apple's earnings report is always eagerly anticipated by investors. While the company is expected to perform well this quarter, our team of experienced traders have noticed a few warning signs. In this blog post, we'll take a closer look at the technicals and market trends to see why we believe that Apple will experience a sell-off following their earnings report.


First and foremost, the technicals are showing a break of the parallel uptrend for Apple. As traders, we pay close attention to the charts and can see a clear indication that the pattern has been broken. This is concerning, as it suggests that the bullish trend for Apple is weakening and could potentially lead to a market correction. Additionally, we are seeing bearish divergences and the onset of some overbought signals, which is further adding to our caution.


Another factor that we're keeping an eye on is the historical trend of Apple's stock performance during the months of August and September. These two months have typically been weak for Apple, especially during years where the company has no major product releases. While Apple did release the M1 iPad Pro this year, it's not a significant enough launch to sway the historical trends. As traders, we know that history tends to repeat itself, which is why we're concerned about the stock potentially selling off after earnings.


Furthermore, Apple is facing some unique challenges this quarter, particularly in the form of supply chain constraints. The global chip shortage has affected multiple industries, and Apple is no exception. The company is anticipating a hit to their sales figures due to these shortages, which could cause them to miss earnings estimates. Wall Street is expecting Apple to earn approximately $14B in profits this quarter, but if the company misses the mark, it could lead to a sell-off in the stock.


Lastly, the ongoing regulatory discussions surrounding Apple are also cause for concern. The company is currently facing antitrust scrutiny and could be subject to new regulations. This uncertainty is never good for investors and could potentially harm the stock's performance. While we don't anticipate any immediate regulatory actions causing a selloff, it's important to remain aware of this risk.


Conclusion:

While Apple is expected to perform well this quarter, our team believes that the technical indicators, market trends, and unique challenges facing the company could lead to a sell-off following their earnings report. As traders, we always approach the market with caution and make decisions based on the data available to us. We encourage all investors to do their own research and consider the risks before making any investment decisions. As always, we will be closely monitoring the situation and adjusting our strategies accordingly.


Apple Weekly Stock Chart
Apple Weekly Stock Chart


Apple Daily Stock Chart
Apple Daily Stock Chart

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