The same bullish Apple analysts, who missed the significant slowdown in iPhone sales, are now saying the worst is behind the company. Should investors listen to them or the analysts who got it right?
Apple disappointed Wall Street by reporting lower-than-expected fiscal second-quarter earnings Tuesday. IPhone unit sales fell 16 percent year over year, the first decline ever for the company's smartphone business.
"We believe the soft FQ3 (fiscal third quarter) guidance reflects the last of the negative data points around the iPhone 6S cycle and anticipate a return to growth in the iPhone 7 cycle," Pacific Crest's Andy Hargreaves wrote.
Similarly, Stifel Nicolaus' Aaron Rakers said Wednesday on CNBC that this is the trough. "We like the setup going into the iPhone 7 cycle, and particularly going into the December and March quarters of next year," he said on "Squawk Box."
But the pessimistic analysts who were correct on the weak iPhone 6S cycle are growing increasingly negative on the iPhone 7 too.
"Our concerns about slowing smartphone market growth and elongating refresh cycles were reinforced," Deutsche Bank's Sherri Scribner wrote in a note to clients Tuesday after Apple's report.
Scribner believes Apple's next product will not turn things around as the latest supply chain checks show the iPhone 7 will have a similar design to the current model. "Without a compelling new form factor, we believe it will be hard for Apple to convince iPhone owners to upgrade," she wrote in an April 20 report.
More ominous is the latest missive over the weekend from the person some call "the best Apple analyst on the planet," Ming-Chi Kuo of KGI Securities.