How Wall Street Reacts to Apple's Earnings Reports
When Apple reports its quarterly earnings on Tuesday, things will be a little different than they have been for the most part of the past decade: Given the weak guidance that Apple gave for the recently completed quarter there are almost no expectations.
During its last earnings report in April, Apple predicted revenue for the June quarter to come in between $41 and $43 billion, down between 13 and 17 percent from the $49 billion the company raked in between April and June 2015. The consensus on Wall Street is that Apple will hit that target range, so if it actually does, investors probably won’t be overly disappointed.
For the past few years, it has become increasingly difficult for Apple to meet the expectations its own success helped create. In January 2016, the iPhone maker reported the largest quarterly profit of any company in history and saw its stock price drop more than 6 percent the next day. The fact that the company had narrowly missed expectations in terms of revenue and iPhone sales and given a cautious outlook for the beginning of 2016 was enough to send its shares tumbling.
Given that the June quarter is traditionally on the weaker side and that Apple already warned its investors of an upcoming sales decline, it’ll be interesting to see what happens to the company’s stock price after Tuesday’s earnings announcement.
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