Apple 'At Some Risk' Of Revenue Drop In Calendar Year 2024, Says Analyst: 'iPhone Unit Shipments Are Simply Too Soft' (UPDATED)

Update: This article was updated with a correction on Apr. 7, 2024 at 02:13 a.m. (EDT).

Apple Inc. (NASDAQ:AAPL) could report a fall in revenue and earnings per share (EPS) in the calendar year 2024 due to declining iPhone sales in China.

What Happened: An analyst at Loop Capital, Ananda Baruah, has revised his estimates for Apple’s earnings, foreseeing a potential drop in the company’s overall revenue and EPS for the first time since 2016, reported Barron's.

Apple reported a marginal revenue decline in calendar year 2023 when compared to 2022, but the decline in 2016 was more drastic.

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Apple's last calendar year revenue decline was in 2016 — its revenue fell to $218.12 billion from $234.99 billion in calendar year 2015.

Baruah’s projections for the March and June quarters suggest that Apple’s earnings might not meet Wall Street’s expectations. He reduced his target price for the Apple stock to $170 from $180, with a “Hold” rating on the stock.

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Despite the concerning figures, Baruah suggests that Apple’s stock could receive a boost from the announcement of AI developments at its June developers’ conference and the sales of its Vision Pro headset.

Why It Matters: Apple’s recent struggles in the Chinese market have been a topic of concern. The company’s iPhone sales in China faced a sharp decline amid rising competition.

This was followed by CEO Tim Cook’s visit to China which was seen as a message to the Xi Jinping administration that Apple was committed to the Chinese market.

Analysts have also pointed out that Apple’s struggles in China are less about Apple and more about a much bigger geopolitical kerfuffle. This was echoed by "Mad Money" host Jim Cramer who said that nothing good is going to come of China for Cupertino after iPhone’s recent plunge.

Price Action: Apple's stock closed 0.45% lower on Monday at $170.03, according to Benzinga Pro.

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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.

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