Apple is set to beat its most profitable quarter

Apple is set to beat its own record for the most profitable quarter in corporate history when it reports earnings on Thursday, with analysts forecasting net income of at least $19 billion. The three months to December 2017 — the smartphone maker’s fiscal first quarter and traditionally its biggest — is the first to include sales of the new iPhone X and is expected to beat its previous quarterly record of $18 billion net income in 2015… The US corporate earnings season is in full swing this week, with other tech leaders including Facebook, Alphabet and Amazon also expected to report higher revenues and profits. Strong tech sector earnings are likely to keep Wall Street’s current bull run intact after equities had their best opening to a year since 1987, buoyed by tax reform and a weaker dollar. The S&P 500 tech sector has already risen nearly 9 per cent in January after surging 37 per cent last year… The high pricing of the iPhone X, which starts at $999, combined with Apple’s unusual move to release different iPhone models several weeks apart, means there is a wider spread of expectations for its results than normal… However, a blockbuster performance in the December quarter could mean iPhone sales slow down faster this year than Wall Street is expecting… As well as predicting strong iPhone sales, investors are hoping that US tax reforms will lead to an increase in Apple’s capital return programme.
Tim Bradshaw