Apple forecasts thinner December-quarter margin, shares slip
Apple expects its gross margin to land between 45% and 46% for the December quarter, below the 46.3% average analyst estimate, and its shares fell about 2% on Tuesday after the forecast. The company, through CFO Kevan Parekh, attributes the squeeze to higher memory costs and spending tied to the ramp of Siri AI. Gross margin was 50.1% in the June quarter and 47.9% in the September quarter. Analysts had expected revenue to rise nearly 11% to $113.39 billion for the quarter, with net profit up about 6% to $29.04 billion, according to LSEG estimates reported by Reuters. The first-quarter earnings call is scheduled for Monday evening in Europe.
Key facts
- iPhone revenue is forecast to rise about 15% to $56.54 billion for the quarter.
- Services revenue is expected to grow almost 10% to $31.56 billion.
- Apple raised iPhone prices by $100 in September.
- Apple is offering replacements for iPhone Duo units with cracks along the inner display fold.
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Why it matters
Rising component costs could weigh on Apple's profit growth as it funds new products and AI features.
What changed
First published from CNA, Euronews and CNBC