The first optimists are already venturing forward: a few hours before the announcement of the balance sheet for the first quarter (January to March), the share price rose from Apple by around 1.5 percent, a small sign of hope after a decline of more than three months. The shares of the second most valuable private company in the world after Microsoft have already fallen by around 12 percent since the beginning of the year: Together with Tesla Apple is one of the two stocks from the “Fantastic Seven” (Nvidia, Alphabet, Amazon, Microsoft, Meta, Tesla, Apple), which have lost market value in the current year. Slow iPhone sales in the important market China has recently scared investors away. Apple is also burdened by trouble with the US Department of Justice, which has accused the company of abusing its market power for years and is demanding that the AppStore be opened.
But there are now increasing signals at Apple that things could look up again this year. In the important Christmas quarter of 2023, the Cupertino-based company had already increased sales by 2 percent year-on-year to $120 billion.
Analysts are nevertheless cautious in view of the traditionally weaker first quarter. They expect sales to have fallen slightly compared to the same quarter last year, to around $90 billion. According to an analysis by Factset, a profit of 23 billion dollars and a profit of around 1.50 US dollars per share are also expected.
If Apple exceeds these relatively modest expectations, the stock’s recent recovery could continue. Analysts expect that Chinese competitor Huawei in particular will continue to hurt Apple in China and that iPhone sales in the Far East will continue to fall. But with the recent price weakness, Apple’s valuation has also fallen – Apple is now valued at “only” 25 times expected earnings, while tech giants such as Nvidia, Microsoft and Alphabet are priced significantly higher after their recent price rally.
In addition, there is the expectation that Apple boss Tim Cook (63) will comment on the further development of the “Vision Pro”. With the help of data glasses, Apple wants to enter a new business area and catch up with the competition in the booming topic of artificial intelligence. Even a gentle hint that future generation iPhones may work with generative AI could be enough to drive the price. Elon Musk demonstrated how Tesla did it a few weeks ago: the indication of accelerated development of cheaper models was enough to give the stock a boost despite weak numbers.
Apple will announce its figures today after the US market closes (10 p.m. CEST).