Apple, Inc. Q2 Earnings Preview: Boring Results?

Tomorrow is tech's quarterly Super Bowl: Apple (AAPL 1.27%) earnings. Here is your last-minute update with the latest coverage.

Expectations
Analyst estimates for Apple's fiscal 2014 second-quarter results can be best described in one word: flat. Across almost every key metric analysts expect very little growth, if any at all. In fact, the consensus estimate for revenue among analysts polled by Fortune's Philip Elmer-DeWitt is about $43.6 billion, or .02% lower than the year-ago quarter. For EPS and gross profit margin, analysts expect slight gains -- EPS of $10.33 compared to $10.09 in the year-ago quarter and a gross profit margin of 37.8% compared to 37.5% last year.

The chances are good that analyst estimates for the quarter are close to accurate. Ever since Apple changed the way it provides guidance in Jan. 2013, Apple's projected range for key financial metrics has been an excellent indicator of actual results. And, unsurprisingly, analysts are forecasting that revenue and gross profit margin will come in within the window Apple provided investors.

Are surprises possible?
If there are any surprises, it will probably be in the composition of revenue -- not the financial results. For instance, in Apple's fiscal 2014 first-quarter results, revenue came in higher than most analysts expected while iPhone unit sales were worse than expected. The unexpected revenue came from a higher than expected average selling price for the iPhone and higher than expected revenue in other Apple business segments.

iPhone 5c. Image source: Apple.

With these possible surprises in mind, here are the consensus expectations for unit sales of Apple's three largest business segments versus last year's figures.

As the biggest driver of Apple's financial results, it's good to see analysts expect growth in iPhone unit sales. That said, the level of expected growth certainly isn't impressive. The projected 2.2% growth in unit sales is a meaningful decline from the year-over-year unit sales growth of 7% Apple reported in Q1.

Zoom out
While it's fun (for tech stock geeks like me, at least) to compare results to estimates, Apple investors should remain focused on the bigger picture. Ultimately Apple will thrive or stumble based on innovation in new products. So it will be the later half of 2014 that will be important to investors. Not only will Apple likely be refreshing its existing product lines (particularly the iPhone and the iPad), but Apple CEO Tim Cook has promised to launch entirely new product categories by the end of the year. Apple rumor mill chatter suggests one of these new products may be an iWatch, or a wearable device with biometric sensors that is connected to the Internet and runs a version of iOS.

While investors wait to see Apple's new products and how they will perform in the market, investors can take comfort in the fact that very little growth is priced into the stock and that Apple's healthy stream of cash flow should continue to enable its aggressive share repurchases. Then, of course, there's Apple's dividend that could possibly soon be subject to an increase.