Apple earnings: Here's what to expect after the Apple Watch launch and record iPhone 6 sales in third quarter results

 
Clara Guibourg
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Has the Apple Watch lived up to expectations? (Source: Getty)

The world’s most valuable company looks set for another strong quarter, as blockbuster iPhone 6 sales, particularly in China, continue to boost its growth.

Apple smashed analysts’ expectations last quarter, with its best second quarter results ever. Sales reaching $58bn and a net profit of $13.6bn caused the tech giant’s share price to soar 38 per cent over the year.

The company is reporting its third-quarter earnings tomorrow at 9pm GMT. Here’s what to look out for:

1. The figures

Apple has guided for revenues of between $46-48bn and gross margins between 38.5 and 39.5 per cent, but analysts are suggesting the company may well blow past these expectations once more.

2. How’s the Apple Watch doing?

Tomorrow’s set of results are the first released since the launch of the Apple Watch. Although unlikely to have a big effect on sales, the smart watch is still the biggest new product category since the release of the first iPhone in 2006.

Reports of disappointing sales have come in, with Slice Intelligence suggesting online sales are down 90 per cent since the opening week.

3. Will momentum in China hold up?

Sales of flagship model iPhone 6 in China have been driving Apple’s growth through the roof, with revenue in the region up 71 per cent over the past year. That’s a growth rate three times faster than Europe or America.

Analysts are suggesting that this growth is slowing, and if the region’s economy grows, this may have a large impact on Apple’s sales.

4. Effect on the rest of the tech sector

Apple results are important enough to act as a bellwether for the tech sector. According to Market Watch analysts, the sector would expect a six per cent profit decline without Apple, rather than the 0.2 per cent gain predicted.

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