Initial Impression From Apple’s 4Q23 Earnings, Key Numbers From Apple 4Q23, About Apple’s 1Q24 Guidance
Hello everyone. Welcome to a special Friday edition of the Daily Update. We will begin our Apple’s earnings review. The discussion will be purposely kept broad for now. Next week, we will dive into some of the nitty gritty. Let’s jump right in.
Initial Impression From Apple’s 4Q23 Earnings
Apple’s financial performance is trending very close to our existing assumptions. Underlying demand for Apple hardware appears to be down low single digits driven by slowing upgrading trends, especially with the iPad, Mac, and AirPods. Mostly offsetting HW weakness, Services revenue momentum continues to build with growth re-accelerating despite Apple working with a much larger base.
While Apple’s 1Q24 guidance may have disappointed some, when excluding one-time factors including calendar year differences and COVID supply issues, Apple guided to roughly flat revenue growth. Meanwhile, Apple’s 45% to 46% gross margin guidance was stellar. The Apple story remains firmly intact heading into 2024 and Apple’s most important product launch in nearly a decade with Vision Pro.
Key Numbers From Apple 4Q23
Here are Apple’s reported 4Q23 results versus my expectations with brief commentary for each item.
An Above Avalon membership is required to continue reading this update. Members can read the full update here. An audio version of this update is available to members who have the podcast add-on attached to their membership. More information about the podcast add-on is found here.
(Members: Daily Updates are always accessible by logging into Slack. If you haven’t logged into Slack before, fill out this form to receive an invite.)
Above Avalon Membership
Payment is processed and secured by Stripe. Apple Pay and other mobile payment options are accepted. Special Inside Orchard bundle pricing is available for Above Avalon members.
More information about Above Avalon membership, including the full list of benefits and privileges, is available here.