Apple (AAPL) is scheduled to report results of the second fiscal quarter of FY25 after the market close on Thursday, May 1, with a conference call scheduled for 5:00 pm ET. What to watch for:
EXPECTATIONS: Last quarter, Apple beat consensus sales and earnings expectations, reporting EPS of $2.40 on Q1 revenue of $124.30B in what Apple CEO Tim Cook called the company’s “best quarter ever.”
Cook added: “We were thrilled to bring customers our best-ever lineup of products and services during the holiday season. Through the power of Apple silicon, we’re unlocking new possibilities for our users with Apple Intelligence, which makes apps and experiences even better and more personal. And we’re excited that Apple Intelligence will be available in even more languages this April.”
Current consensus EPS and revenue forecasts for Apple’s March-end quarter stand at $1.62 and $94.56B, respectively, according to data from LSEG Data and Analytics.
Consensus EPS and revenue forecasts for Apple’s June-end quarter stand at $1.47 and $89.3B, respectively, according to LSEG Data.
Among analysts tracked by Bloomberg that have updated their views on Apple within the last twelve months, 36 have Buy or equivalent ratings, 21 have Hold or equivalent ratings and three have Sell or equivalent ratings. The average twelve month price target of 41 of those analysts is $230.19.
TWO BEARS GET LESS BEARISH: On April 9, Jefferies upgraded Apple to Hold from Underperform with a price target of $167.88, down from $202.33. The firm reduced iPhone shipment estimates by up to 7% through fiscal 2027 due to global recession risks, and cut its artificial intelligence revenue forecasts in fiscal 2028 and beyond given a bearish view on smartphone AI. Jefferies still assumes Apple will be exempted from U.S. tariffs and upgraded the shares to Hold given the recent selloff. However, Apple shears are “still not cheap,” the analyst told investors at that time. Jefferies’ base case remains that Apple would be exempted from U.S. tariffs, given its commitment to invest $500B in the U.S. over the next four years, and its belief that it would make additional manufacturing investment commitment in the U.S. However, a rising risk of global recession “could further impact already-weak iPhone demand,” the firm added.
On April 14, KeyBanc upgraded Apple to Sector Weight from Underweight without a price target. The White House announcement of an exception from some tariffs on smartphones was “probably the best case scenario” for Apple, which makes it unlikely KeyBanc’s prior downside call will be achieved, the analyst told investors at that time. The move “takes a big risk off the table” for the company, contends KeyBanc. The firm does not think Apple is fully “out of the woods, however, saying growth expectations remain high looking to fiscal 2026 and there is likely still consumer spending pullback occurring. Nonetheless, KeyBanc believes the worst case scenario of continuing “tit-for-tat” trade war escalation is likely no longer in play, making it difficult to argue for further downside in Apple shares.
Earlier this week, Raymond James lowered the firm’s price target on Apple to $230 from $250 and kept an Outperform rating on the shares. The firm cites tariff related headwinds for the target cut. Apple has enough manufacturing capacity outside China to address about half of U.S. iPhone demand, the analyst tells investors in a research note. The firm expects the company’s procurement from non-China regions to continue to increase. Whether imports from India and other regions will be tariff-free beyond the 90-day pause is unclear, however, adds Raymond James. The firm’s base base is for Apple to raise prices in the U.S., which will likely lead to some demand destruction. The net effect could still result in lower earnings, it predicts.
Meanwhile, Morgan Stanley raised the firm’s price target on Apple to $235 from $220 and kept an Overweight rating on the shares. The firm expects March quarter results and June quarter guidance to “modestly” exceed consensus, though it sees some downside to June quarter gross margins given the tariff backdrop, the analyst tells investors in a preview. The firm forecasts March quarter revenue of $95.7B and EPS of $1.64, both of which are slightly ahead of consensus, on strong Product pull-forward, a weaker U.S. dollar and 12% Services growth, Morgan Stanley added.
NOT JUST ANALYSTS UPGRADING: On April 8, Meghan Bobrowsky of The Wall Street Journal reported that while it was too early to determine if tariffs will result in an increase in the pricing of Apple’s iPhone, many customers aren’t waiting to find out and were rushing to purchase new phones. Over the weekend near when the report was published, sales associated at two Apple stores in San Francisco said customers mentioned tariffs as their reason for purchasing a new iPhone, the Journal noted.
SIRI DELAY: On March 10, shares of Apple declined after the company delayed promised updates to its Siri digital assistant, saying the features first announcement last June would be released sometime in “the coming year. ”
Subsequent to that news, Citi analyst Atif Malik removed the firm’s “90-day positive catalyst watch” on Apple shares while keeping a Buy rating on the name with a $275 price target. The firm cited a delay in the “much-anticipated” Siri upgrade as part of the iOS 18.4 update in April for the removal. Citi lowered its 2025 and 2026 iPhone units estimate to 232M and 244M, respectively, to reflect a delay in the Siri upgrade. While Apple Intelligence utility is different for different people, an upgraded Siri would have driven a higher iPhone refresh this year, the firm contended. However, the firm still thinks Apple is making progress in rolling out Apple Intelligence in China.
On March 31, Apple said that Apple Intelligence was expanding to “even more people around the world.” The company stated: “Starting Monday, with the availability of iOS 18.4, iPadOS 18.4, and macOS Sequoia 15.4, Apple Intelligence features are now available in many new languages, including French, German, Italian, Brazilian Portuguese, Spanish, Japanese, Korean, and simplified Chinese – as well as localized English for Singapore and India – and are accessible in nearly all regions around the world. In addition, iPhone and iPad users in the EU have access to Apple Intelligence features for the first time, and Apple Intelligence expands to a new platform with an initial set of features available in U.S. English with Apple Vision Pro.”
After that, Citi noted that Apple released iOS 18.4 on March 31, which expanded Apple Intelligence into several new languages, including simplified Chinese, and to the European Union. As expected, the feature updates in iOS 18.4 do not include Siri due to the previously announced delay, the analyst told investors. Citi thinks Apple will likely reset Siri software expectations on the next earnings call before heading into WWDC on June 9. The shares are getting closer to Citi’s “bear case” following the Siri delay, creating an attractive risk/reward post selloff, contended the firm at that time.
More recently, Citi lowered the firm’s price target on Apple to $245 from $275 and kept a Buy rating on the shares. The firm expected Apple shares to rally on the Trump administration tariff exemptions for PCs and smartphones announced just prior to when the note was published. That said, Apple products are not immune from a weak macro environment, the firm added. As such, it lowered its iPhone, Mac, and wearable units to better align with Citi’s 70 point global GDP contraction view in 2025.
