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Earnings preview: Sales of the season

Dan Moren | Jan. 28, 2014
The holidays may be over for the rest of us, but Apple hasn't yet disclosed whether its stocking was overflowing with treats or contained only a lump of coal. On Monday, the company will reveal its earnings for the first quarter of fiscal 2014, which includes the winter shopping season. As usual, the announcement will be followed by a conference call at 2 p.m. PT/5 p.m. ET with Apple executives and financial analysts; Macworld will, of course, be on hand to provide live coverage of the earnings and the call.

Of course, as with the iPhone, Apple now has a wide variety of iPad models available at a range of price points, so keep an eye out for analysts asking about mix and average selling price of the tablet; they'll be trying to divine which model is selling the best.

Back to the Mac
And what of the birthday boy? The Mac's 30th anniversary will probably get some play from Cook and co., as will the new Mac Pro. Mac sales have remained largely steady over the last few years, ranging from around 3.7 million to 5.2 million, and it's a good bet they'll remain within that range.

Small updates to the iMac and Retina MacBook Pro both emerged last quarter, but the most prominent arrival was the aforementioned Mac Pro. Of course, the professional desktop is a niche product that's not likely to sell in huge quantities — and it's still not shipping in quantity either; new orders have been pushed back to March at this point. It will be interesting to see if Apple gives any more detail about sales of the high-powered machine to date.

What happens in China ...
Asia has been an area of intense interest for Apple over the last few years, and the most recent quarter is no exception. In December, Cupertino finally struck a deal with China Mobile, the country's biggest wireless provider, to sell the iPhone. However, it's important to note that the handset didn't go on sale until the middle of January, which was well after the end of Apple's first 2014 quarter, so we won't see an impact from that until next quarter.

Of course, that won't stop analysts from asking questions about the China deal, and what Tim Cook hopes to get out of it. Expect the Apple CEO to talk about how excited he is to finally have the opportunity to reach more customers in the Greater China region, and possibly to field a few questions about the effect of the deal on China's active gray market.

By the numbers
Last quarter, Apple CFO Peter Oppenheimer left us with a forecast of between $55 billion and $58 billion in revenue for the first quarter of 2014, along with a gross margin of 36.5 and 37.5 percent. In comparison, the company booked $54.5 billion in revenue during last year's holiday quarter, with income of $13.1 billion; that translated to earnings per share of $13.81.

For the first quarter, analysts are expecting revenue of around $57.64 billion, and earnings per share of $14.09. That's at the high end of Oppenheimer's guidance, and would provide a nice boost over the year-ago quarter's earnings.


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