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Apple Inc. Earnings: Risky Numbers To Watch

Apple Inc. NASDAQ:AAPL

Apple Inc. (NASDAQ: AAPL) earnings are going to hit on Monday, and the company’s investors are getting ready to see just how many iPhone 6 and iPhone 6S smart phones were moved during the first quarter of the year.

Apple on window

With a very strong quarter likely behind it, the Cupertino company is expected to report its best second quarter of all time on Monday. There are some figures that the company could fall short on, and raise the ire of its investors, however, here’s a look at the key data that Apple will have to hit in order to ensure stock stability on Monday.

Apple key earnings numbers

iPhone sales: There’s a wide range of estimates for iPhone sales going into the earnings report, but he consensus number comes in at around 55 million. Douglas A. McIntyre over at 24/7 Wallstreet, however, says that anything less than 60 million will be a disaster for the company and may result in a drop in sales. Less than 70 million could be considered a disappointment by some investors, according to the analyst.

Katy Huberty of Morgan Stanley reckons that Apple will fail to hit those numbers, and record just 57-58 million in iPhone sales for the period. That’s a head of consensus but, if McIntyre is right, it will disappoint investors.

Gross Margin: The last time that Apple shares were hitting record highs worries about gross margins stepped in and deflated the company’s valuation. Despite the Apple Watch apparently being the company’s most profitable device of all time, any softness on the company’s gross margin could lead to a flights from the company’s shares on worries about the future. Apple set its guidance for the number at between 38.5% and 39.5%.

A lot of analysts, such as RBC Capital Markets analyst Amit Daryanani, are expecting that number to end up at the top of the range however, and would be disappointed with anything less than 39%. Mr. Daryanani is expecting gross margin to hit 39.5%. Wells Fargo analyst Maynard Um is looking for the number to hit 40.2%.

China sales:

Apple is relying on China to be the growth market for the iPhone in 2015, and the first quarter of the year showed just how incredibly popular the iPhone 6 is in the greater China region. Apple may or may not actually go into specifics of the Chinese market, but analysts at Kantar Worldpanel reckon that the company took about 27.6% of the country’s smartphone market in the first three months of 2015.

Consensus numbers

Analysts are looking for Tim Cook and his crew to reveal earnings per share of $2.16 for the first three months of 2015. Revenue will come in at $56 billion according to Wall Street.

Earnings will arrive after the market closes on Wall Street on Monday afternoon though knowing the Apple executive team, there will be a wait. The company will host a conference call to discuss the above numbers and more at 5 PM EST on Monday.

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