Apple's Revenue And EPS Expectations Are Fairly Muted

Fortune reporter Philip Elmer-Dewitt compiles Apple forecasts from sell-side and independent analysts. For the June quarter the 56 analysts (37 Wall Street professionals and 19 Independents) have a range of $33.8 to $38.1 billion in revenue while the sell-side analysts ranging from $33.8 to $36.2 billion (average of $35 billion). Apple's revenue guidance is $33.5 to $35.5 billion and I am at $36 billion. Note that my family and I own Apple shares.

Revenue of $36 billion would represent a 3% increase year over year and could even be negative if it doesn't reach the $35 billion achieved last year. Due to few new products or significant channel partners being launched so far this year the June and September quarters will have a hard time showing much if any revenue growth.

I am expecting 26.4 million iPhones which would only be up 2% when adjusted for channel inventory. Even with iPad units increasing 26% to 20 million due to the lower average selling price (ASP) driven by the Mini I'm projecting its revenue could be down 4% year over year.

Source: Fortune magazine Philip Elmer-Dewitt

The EPS range for all analysts is $6.66 to $8.70 with all but two of the sell-side analysts between $6.66 and $7.61 (average of $7.31). When you use Apple's revenue, gross margin and operating expense guidance the EPS guidance range is:

Low $6.65

Middle $7.05

High $7.45

I am at $7.47 which would be a decrease of 20% from last years $9.32. With revenue being essentially flat the decline is driven by lower gross margins. Gross margin guidance is between 36% and 37% (I am at 36.4%) vs. last years 42.8%, the third highest in Apple's history. Note that every 50 basis points or 0.5% change in gross margin effects EPS by $0.15.

While I have the share count lower by 11 million it only helps EPS by $0.08 or just over 1%. It will take a few quarters of significant buyback activity to move the EPS needle.

Source: Fortune magazine Philip Elmer-Dewitt

Below is a listing of all 56 analysts sorted by their EPS estimates. Apple reports after the market closes next Tuesday, July 23.

Source: Fortune magazine Philip Elmer-Dewitt

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