- As expectations for the next iPhone overshadow spring sales, the top and bottom line may not be top of mind for many on Wall Street.
- IPhone sales, China revenue, services revenue, and revenue and margin guidance for the fiscal fourth quarter are all in focus.
- Commentary on supply or demand, HomePod, content and repatriation will also be key.
As the most valuable American company by market capitalization, Apple's financial results are an event that often has markets on edge. But as expectations for the next iPhone overshadow spring sales, the top and bottom line may not be top of mind for many on Wall Street.
Luckily, Tuesday night's report promises a wealth of data that could give savvy investors a hint into Apple's future plans. (Track CNBC's live coverage of earnings here.)
1. iPhone sales
- Fiscal Q3 shipments: 40.7 million expected by a StreetAccount consensus estimate
- Fiscal Q3 iPhone revenue: $25.52 billion expected by a StreetAccount consensus estimate
- Why it matters: Always an important metric for Apple, soft iPhone sales might point to an ongoing trend of consumers holding off to upgrade to the iPhone 8, setting expectations for the rest of the year. Analysts estimate there's a slew of people with sixth-generation iPhones — one of Apple's best-sellers — that have to be upgraded sometime soon. The question is how soon.
2. Revenue and margin guidance for the fiscal fourth quarter
- Fiscal Q4 margin guidance: 38.3 percent expected by StreetAccount consensus estimate
- Fiscal Q4 revenue guidance expectations: $49.21 billion expected by Thomson Reuters
- Why it matters: Again, analysts hope to decode not only how many iPhone 8 devices Apple expects to sell, but whether the phone will ship later than its usual September release.
3. China revenue
- Fiscal Q3 greater China revenue: $8.57 billion expected by a FactSet consensus estimate
- Why it matters: China has been a sore spot in Apple's finances for a while now, as regulatory hurdles and local competition have taken a toll. UBS analyst Steven Milunovich estimates that Apple is gaining market share from competitors everywhere in the world but China.
"China is a wild card," Milunovich wrote in a research note. "A large number of customers are not sure of their upgrade plans."
4. Services revenue
- Fiscal Q3 Services: $7.07 billion expected by a StreetAccount consensus estimate
- Why it matters: Apple CEO Tim Cook has made the ambitious proclamation that Apple intends to double its services revenue by 2020. Loup Ventures' Gene Munster, for one, has predicted that services — including the App Store, Apple Music, Apple Care and other items — could grow to 20 percent of Apple's revenue within five years. But others, like independent analyst and Apple commentator Neil Cybart, are skeptical of Wall Street's expectations for Apple's services business.
Tuesday's earnings could provide a data point that points either toward meteoric growth — or toward Apple's continued reliance on the iPhone as its main revenue stream.
- Supply-Demand: Apple is notoriously tight-lipped about its future plans for products, but sometimes executives will give high-level updates on the supply chain or the demand they saw during the quarter. If executives see consumers holding off on purchases, or if they mention that they expect supply to be tight for the rest of the year, Wall Street might use those clues to piece together expectations for the iPhone 8.
- HomePod: Analysts already know of one piece of hardware that's set to launch this year, which is not always the case during June quarter earnings. HomePod is due to ship in December, but on the off-chance Apple provides any clues about the product, it could be an important indicator of Apple's position headed into the holiday shopping season. Last year, for example, Apple's new AirPods missed nearly the entire holiday season.
- Content: Earlier this year, Cook indicated Apple had tested the waters in original video content for Apple Music. With companies like Spotify, Google, Facebook, Amazon and Snap all reportedly eyeing original content, too, analysts might ask how Apple hopes to compete.
- Repatriation: Apple's cash pile is well over $250 billion already, and much of that is held overseas. But as European regulators take a harder line against tech companies, President Donald Trump has suggested he might lower taxes for companies that bring money back to the U.S. That means that Apple could potentially have a lot of capital to put to work here on U.S. soil.
Disclosure: CNBC parent NBCUniversal is an investor in Snap.