The 10-second takeaway
For the quarter ended June 30 (Q3), Apple missed estimates on revenues and whiffed on earnings per share.
Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share increased significantly.
Gross margins grew, operating margins grew, net margins shrank.
Apple reported revenue of $35.02 billion. The 39 analysts polled by S&P Capital IQ looked for a top line of $37.36 billion on the same basis. GAAP reported sales were 23% higher than the prior-year quarter's $28.57 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $9.32. The 42 earnings estimates compiled by S&P Capital IQ anticipated $10.41 per share. GAAP EPS of $9.32 for Q3 were 20% higher than the prior-year quarter's $7.79 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 42.8%, 110 basis points better than the prior-year quarter. Operating margin was 33.0%, 20 basis points better than the prior-year quarter. Net margin was 25.2%, 40 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $37.65 billion. On the bottom line, the average EPS estimate is $10.07.
Next year's average estimate for revenue is $160.76 billion. The average EPS estimate is $46.64.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 26,085 members out of 28,348 rating the stock outperform, and 2,263 members rating it underperform. Among 6,421 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 6,214 give Apple a green thumbs-up, and 207 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Apple is buy, with an average price target of $746.15.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of Apple. Motley Fool newsletter services have recommended buying shares of Apple. Motley Fool newsletter services have recommended creating a bull call spread position in Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.