Apple (NASDAQ:AAPL) investors will soon get to see whether the company can live up to the Street's heightened expectations. The company has scheduled its fiscal fourth-quarter earnings call for Thursday, Nov. 1. Highlighting the growing optimism for Apple, shares have been surging, climbing an impressive 50% over the past year and 23% in the past three months alone as investors bet the company can keep delivering strong growth.
Helped by a return to growth in Apple's iPhone business and strong growth from services and other products, Apple's trailing-12-month revenue is up 14% year over year. Of course, thanks largely to Apple's aggressive share repurchases, earnings per share is up even more sharply during this period. Can Apple keep up this momentum?
Here's an early preview of what investors will want to look for when Apple reports its fiscal fourth-quarter results next month.
Double-digit revenue growth
It's difficult to overstate Apple's momentum recently. In Apple's third quarter of fiscal 2018, the tech giant not only posted its fourth quarter in a row of double-digit year-over-year revenue growth, but it reported its seventh consecutive quarter of accelerating revenue growth. This led to Apple's best June quarter ever for both its top and bottom lines.
Can Apple pull off another strong quarter? Based on Apple's revenue guidance, which typically proves to be very accurate (if not a little conservative), it's highly likely. Apple said it expects fiscal fourth-quarter revenue to be between $60 and $62 billion. This implies impressive 14% to 18% year-over-year growth.
Robust iPhone revenue
As usual, investors will pay close attention to Apple's iPhone sales for the quarter. Though Apple's services and "other products" segments are growing in importance to the company and ultimately helping Apple's long-term growth story become less dependent on iPhone, the company's smartphone segment is still integral to overall results. Indeed, iPhone accounted for 62% of Apple's trailing-12-month revenue.
Apple's fiscal fourth quarter is always an interesting period for iPhone, as it usually includes about 10 days of sales of the company's newest iPhone models -- and this year is no exception. Depending on how those last 10 days of the quarter went, new iPhone models can make a meaningful difference in the quarter's overall iPhone revenue.
Based on Apple's revenue guidance, management likely expects a good quarter from iPhone. Without meaningful growth in iPhone revenue, Apple likely wouldn't be guiding for double-digit growth for its overall top line. Investors should look for iPhone revenue to increase about 13% to 16% year over year during the quarter.
Apple will release its fourth-quarter results after market close on Nov. 1.
Daniel Sparks owns shares of Apple. The Motley Fool owns shares of and recommends Apple. The Motley Fool has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool has a disclosure policy.