Anticipated Decline in Apple Sales and Earnings for 2024 Due to iPhone Slowdown

Anticipated Decline in Apple Sales and Earnings for 2024 Due to iPhone Slowdown

A Wall Street investment firm on Monday lowered its price target on Apple (AAPL), citing a reduction in iPhone orders amid weak demand, particularly in China.




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Loop Capital analyst Ananda Baruah reiterated his hold rating on Apple stock and reduced his price target from 185 to 170.

In the morning discussions on the stock market todayApple shares fell 0.9% to 169.99.

“We now expect Apple’s overall revenue and EPS (earnings per share) to decline year over year in calendar year 2024 for the first time since 2016,” Baruah said in a customer note.

Quarterly estimates are under threat

Consensus estimates for Apple’s March quarter results face “some risk,” while Street estimates for Apple’s June quarter face “significant risk,” he said.

“Simply put, iPhone unit shipments are simply too low compared to organic demand but also competition,” Baruah said. Additionally, for the first time in years, Apple is experiencing a flattening of the average selling prices of its iPhones, he said.

In China, Apple faces significant competition from domestic brands Huawei and Xiaomi, Baruah said.

Apple stock down 11% year to date

Meanwhile, potential positive catalysts for Apple shares could come from news about generative artificial intelligence and its Vision Pro headset, Baruah said.

In a separate report Monday, Loop Capital analyst John Donovan said his company’s supply chain checks in Asia indicate Apple has “significantly” scaled back manufacturing of its iPhones.

Apple cut its iPhone order forecast for 2024 to 199 million units, a 7% to 8% drop from previous targets, Donovan said.

Since the start of the year, Apple stock has fallen more than 11%.

Follow Patrick Seitz on @IBD_PSeitz for more articles on consumer technology, software and semiconductor stocks.

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