Apple (AAPL) likely won’t want to put its new CEO even more in the hot seat on earnings day next week.
He has enough on his plate right now!
The news that shook the often steady Apple cart: Apple said Monday afternoon that longtime CEO Tim Cook will step down later this year and transition to executive chairman. As many on the Street expected, he will be succeeded by John Ternus, currently Apple’s senior vice president of hardware engineering. Ternus will take the helm on Sept. 1.
What Yahoo Finance is hearing on this C-suite shake-up: The timing of the announcement caught some on Wall Street by surprise, perhaps explaining why the stock is down close to 3% on Tuesday. But B. Riley chief market strategist Art Hogan and Visible Alpha Research at S&P Global head Melissa Otto each raise a good point: Apple is likely poised to report a strong quarter on April 30.
“You don’t make an announcement like this on a Monday night if you think you’re missing your earnings,” Hogan said on Yahoo Finance’s Opening Bid. “One signal you can take from this right now is the earnings are in the bag and the guidance is going to be positive. That’s my only takeaway. I think the new guy is going to be fine.”
Said Otto, “I think net net, [earnings] are looking fairly resilient as we look forward. The real issue is going to be around the commentary and what sort of visibility the new leadership is going to give around their strategy for innovation and also for growing services.”
Wall Street vibe on Apple’s upcoming earnings release: The influx of Apple earnings previews hasn’t hit en masse just yet. But those notes Yahoo Finance has checked out reinforce the points made by Hogan and Otto.
Two analyses that caught our attention:
Goldman Sachs analyst Michael Ng: “We believe concerns for Apple are overly pessimistic given its much stronger relative position, which we believe has been supported by recent datapoints including high-end smartphone outperformance (confirmed by Taiwan Semiconductor (TSM) in its latest earnings call, iPhone share gains in China) and reports that Apple is actively securing as much mobile DRAM on the market while keeping pricing competitive for market share gains. Ultimately, we forecast F2Q26E EPS of $2.00, above consensus of $1.93, with outperformance on iPhone revenue, Mac revenue, and gross margins.”
Jefferies analyst Edison Lee: “We expect a slight miss in its March quarter results (also < guidance) due to 1) lower sell-in than sell through led by previously high inventories, 2) 1 percentage point lower gross margin on iPhone due to higher memory costs. Long-term we expect higher memory costs to be offset by its premium iPhone product roadmap, and its ability to raise prices (12% average selling price compound annual growth rate to FY29E).”
