Apple is expected to report modest revenue growth in Q1 with declining iPhone sales

From Nasdaq: 2025-01-27 11:27:00

Apple is set to report its first-quarter fiscal 2025 results on Jan. 30 with revenue growth expected in the low to mid-single digits. The Zacks Consensus Estimate for Q1 revenues is $124.04 billion, indicating a 3.73% increase year over year. Earnings are expected to increase by 8.26% to $2.36 per share.

iPhone sales are expected to decline in Q1 due to competition from Chinese vendors like Huawei and Xiaomi. Apple’s Services segment, however, is expected to see steady growth with a double-digit growth rate similar to fiscal 2024. The consensus mark for Services is $26.176 billion, suggesting a 13.2% increase year over year.

Mac sales are expected to rise year over year, with IDC data showing a 17.3% increase in Q4 2024. Apple’s market share for Macs improved to 10.1%. In contrast, Gartner estimates a 1.4% increase in PC shipments in Q4 2024, with Apple gaining 4.6%.

Apple’s stock performance has underperformed the Computer & Technology sector, with a forward 12-month P/E of 28.97X. The stock is not cheap, with a Value Score of F. Apple’s AI push with Apple Intelligence aims to enhance user experience and improve its competitive position in the AI space.

However, Apple’s stock is seen as a risky bet due to headwinds in China, delays in Apple Intelligence, and a stretched valuation. Currently, Apple carries a Zacks Rank #4 (Sell). Investors are advised to avoid the stock at this time.



Read more at Nasdaq: Buy, Sell or Hold Apple Stock? Key Tips Ahead of Q1 Earnings