Apple 2Q23: By the Numbers, Apple Device Upgrading Slows, Apple's Emerging Markets Strength (Daily Update)
Today's special Friday edition of the Daily Update will be focused on reviewing Apple's earnings. The idea is to keep things broad and look at the big picture takeaways. We also examine how Apple’s results compared to Neil’s expectations.
Hello everyone. Welcome to a special edition Friday version of the daily update. We will begin going over Apple’s 2Q23 numbers and conference call.
For today, the focus will be on the key numbers and two big picture takeaways. The discussion will continue next week.
Let’s jump right in.
Apple 2Q23: By the Numbers
There were no major surprises found with Apple’s 2Q23 earnings. Device upgrading has slowed, although Apple continues to bring new users into the fold. While the iPhone, iPad, and Apple Watch look OK, AirPods continues to experience growth turbulence, while the Mac is trying to find sales stabilization. In an environment where gross margin integrity is being rewarded, Apple’s results will get attention.
Apple’s guidance for 3Q23 is close to what sell-side analysts were expecting, which likely will come as a disappointment to some. Looking under the hood, it looks like the U.S. macro environment is indeed sluggish, backing up conclusions from various Fortune 500 firms. Offsetting such disappointment, Apple continues to see strong momentum in emerging markets as the company takes share from Android.
Here are Apple’s reported 2Q23 results versus my expectations with brief commentary for each item.
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