Apple Inc. (AAPL) Earnings: Can it Deliver?

And finally Apple is reportedly taking measures to test larger-screen phones which has been very popular among consumers. If Apple can come up with bigger screen sets than the 4 inch iPhone 5 and the 9.7 inch iPad, the company can reinvigorate its product line-up and win over more customer groups.

Guidance and Consensus

The recent weakness in Apple’s stock was partially attributable to the company’s outlook for the June quarter, which was lower than what many investors were expecting. In the June quarter, the company expects its top-line revenues to come in between $33.5 billion and $35.5 billion, which is pretty much flat from the year ago quarter. And the company expects its gross margins to trickle down to 36%-37%, which is a slight sequential decline from 37.5%.

Many analysts and investors have stated their disappointment in Apple’s weak guidance, which reduced the expectations from the firm in the near-term. The sell-side estimates have an EPS consensus of $7.31, on revenues of $35.09 billion for Apple’s June quarter. If Apple can surpass the consensus estimates, the stock can move upwards as the company has been receiving a lot of pessimistic views.

The Bottom Line

Apple Inc. (NASDAQ:AAPL) still has a large and installed fan-base for its products and services which will aid in bringing newer devices to the market. The company has been slow to react to some of the consumer demands in the smartphone marketplace, and if Apple can manage to build newer and innovative products the company can grow its top and bottom line in the long-run. And patient investors will be rewarded handsomely, irrespective of the short-term earnings miss or hit.

The article Apple Earnings: Can it Deliver? originally appeared on Fool.com and is written by Ishfaque Faruk.

Ishfaque Faruk has no position in any stocks mentioned. The Motley Fool recommends Apple and Google. The Motley Fool owns shares of Apple and Google. Ishfaque is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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