Apple expects its revenue in the holiday quarter, normally the company's biggest sales period, to stay the same as last year; Wall Street projected ~5% growth
It me. This first generation product may just never launch here in Ireland 🫤 — https://www.macrumors.com/... X: Fred Hickey / @htsfhickey : Apple Conf. call update. Guidance weak. Cook sounds dejected. “too early to tell” on iphone 15 upgrades. @tech_reve : Apple has projected that its fourth-quarter revenue will be at a similar level to the previous year. However, it's worth noting that last year's fourth quarter was a period when Apple faced supply disruptions due to the COVID-19 lockdowns in China, resulting in lower performance compared to previous years. In essence, the fourth quarter is also likely to struggle to break free from performance setbacks. Gene Munster / @munster_gene : Another factor impacting guidance is tough comps in iPad and wearables. @tech_reve : Thoughts on Apple's Earnings... It seems like Huawei poses a significant threat to Apple. Cook emphasized the strong sales of the iPhone 15 in China, but I believe that the days of Apple dominating the premium market in China as it did before are increasingly challenging to envision. The guidance for the fourth quarter doesn't look very promising. Gene Munster / @munster_gene : I believe most (80%) of analysts models reflected 13 weeks. Some were likely asleep at the wheel. Either way you cut it, it was a soft guide. Alexei Oreskovic / @lexnfx : Tim Cook on Apple's generative AI efforts: “In terms of Generative AI obviously we have work going on. i'm not going to get into details about what it is, because as you know we really don't do that. We are investing. investing quite a bit. We are going to do it responsibly.” Gene Munster / @munster_gene : Bottom line is there is noise in the guidance given the weeks in the quarter and the tough comps. I believe these normalize in the March quarter, and expect overall revenue to be up around 5%, inline with the Street. Gene Munster / @munster_gene : $AAPL stock slipped 3% in after-hours. They guided Dec revenue down by 5% and expect it to be flat yy. They mentioned the 13 weeks in this Dec quarter compared to 14 weeks a year ago. Luca suggested if they had 14 weeks in this December, they would have guided up by 2%. Neil Cybart / @neilcybart : One observation from this Apple earnings call (so far): Both Cook and Luca sound a bit more upbeat on this call versus the past few earnings calls. Neil Cybart / @neilcybart : Apple guidance for 1Q24: Gross margin: 45% to 46%. That's a really strong guide. Gene Munster / @munster_gene : Luca says 2B active devices growing at a “nice” pace. That's the flywheel that allows $AAPL investors to sleep well at night. Neil Cybart / @neilcybart : Apple guidance for 1Q24: We expect December quarter revenue to be similar to last year. There's various moving parts in that but all in all not an awful revenue guide. LinkedIn: Wallace Cheung : #Apple's revenue and EPS for 4QFY2023 met expectations, but there were some areas of concern, particularly in #China and #Mac revenue. … Lilli Rantanen : I think that even though iPhone sales grew only 2% in the same period last year, the newly released iPhone 15 is expected to boost that number in the next quarter. … Mark Gurman : Apple sales declined for a fourth straight quarter, marking the longest slowdown since 2001, as the company struggles with sluggish demand and a shaky smartphone market in China. …
Context & Ripple Effects
Apple entered this guidance period after three consecutive quarters of revenue declines, making a flat outlook for its most important seasonal quarter a meaningful test of whether the iPhone cycle could restore growth. The forecast also fell below Wall Street’s roughly 5% growth expectation.
The company had previously shown that Services could grow even as hardware demand softened, with Services revenue rising 12% year over year in 2022. That makes the holiday outlook chiefly a read on Apple’s near-term device-sales and upgrade momentum.
First-order effects
- Apple reset near-term revenue expectations from growth to roughly flat year over year, and its shares fell about 3% after hours as investors repriced the holiday-quarter outlook.
- A 45%–46% gross-margin guide signals that Apple is seeking to protect profitability even while it does not expect a top-line holiday expansion.
Second-order effects
- The gap versus consensus raises pressure on analysts and investors to lower holiday sales assumptions, particularly around iPhone 15 upgrades, rather than treating the seasonal quarter as an automatic growth catalyst.
- With revenue growth uncertain, Apple’s higher-growth Services business becomes more important to the earnings narrative, reinforcing the value of recurring revenue alongside device sales.
Third-order effects
- If holiday growth repeatedly depends on upgrading demand rather than unit expansion, Apple’s valuation and strategy will increasingly hinge on mix, margins, and services monetization instead of annual hardware growth alone.
- The pattern points to a more mature premium-device market in which seasonal guidance can move investor expectations sharply even when profitability remains resilient.
The trend: Apple’s results illustrate the broader shift from dependable annual smartphone-led expansion toward growth that depends more on upgrade cycles, product mix, and recurring services.