Supply Constraints Ding Apple
A shortage of the larger iPhone 7 Plus is the biggest driver behind Apple’s disappointing holiday-quarter guidance, says Morningstar’s Brian Colello.
Brian Colello: Apple reported solid fourth-quarter results this evening. IPhone sales were a little bit ahead of expectations. Revenue was about in line with expectations. They also beat on the EPS line. So, really, a solid fourth quarter from Apple.
The bigger news is always the first-quarter forecast for the December quarter and the holiday season. And there the big story is that the iPhone 7 Plus is a bit supply-constrained, that demand is outstripping supply, and they are not going to be able to satisfy all orders. And so, the revenue guidance for Q1 was $76 billion to $78 billion. That's a little bit higher than what it was a year ago, so only slight growth, which is a little bit of a disappointment. We've seen the stock down about 3% after hours on that news.
Brian Colello does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.