BREAKING NEWS Butte County Sheriff's Office investigating dead body found in Palermo Full Story
SEVERE WX : Fire Weather Watch View Alerts

Apple faces Wall Street 'panic' over iPhone

Even a $100 billion giveaway to shareholders may not be enough for Apple to calm Wall Street.Apple is expected...

Posted: May 1, 2018 6:32 AM
Updated: May 1, 2018 6:32 AM

Even a $100 billion giveaway to shareholders may not be enough for Apple to calm Wall Street.

Apple is expected to announce plans to return between $100 billion and $150 billion to shareholders when it reports earnings results Tuesday for the first three months of 2018, according to analysts.

The potential share buybacks and dividends follows the passage of the US tax bill late last year, which makes it cheaper for Apple to bring back the more than $250 billion it holds overseas. Apple's CFO previously said the company would provide an update on that money with this quarter's results.

But the massive capital return program could be overshadowed by concerns about Apple's most important product: the iPhone.

Apple stock fell this month after one of its key chip suppliers warned of "continued weak demand." Since then, a series of analysts have slashed their estimates for iPhone shipments.

Daniel Ives, an analyst with GBH Insights, wrote in an investor note last week that Wall Street was in "full panic mode" over iPhone sales ahead of Apple's earnings report.

Related: Amazon made Prime indispensable - here's how

Some analysts blame the $999 iPhone X. The new model, with a full bleed screen and facial recognition, was once viewed by investors as key to driving customers to upgrade their smartphones.

Instead, analysts fearApple missed the mark by launching one redesigned model that is too expensive and two other new devices, the iPhone 8 and 8 Plus, that essentially look the same as older models.

Mark Moskowitz, an analyst with Barclays, wrote in an investor note Monday that the iPhone X's "price point was too high and likely alienated many users."

The consensus estimate among analysts is for Apple to have sold 53 million iPhones for the quarter ending in March, up only slightly from the 50.8 million iPhones sold in the same period a year earlier.

While growth in the number of iPhones sold could be more anemic than investors had hoped, Apple's sales are still expected to increase 15% to about $61 billion, fueled in large part by the higher price of the iPhone X.

Investors will also be looking closely at Apple's forecast for sales in the upcoming quarter. Morgan Stanley analysts think demand for the iPhone X, 8 and 8 Plus to be "weaker ... ahead of September's expected new iPhone launch."

As we get closer to the next big launch event, however, investors will likely stop caring as much about the iPhone X and turn their focus to what comes next.

"The Apple story is intact," Gene Munster, an Apple analyst and managing partner at Loup Ventures, wrote in a note last week. "Investor optimism will rise going into the summer as anticipation grows ahead of 3 new iPhones in the fall."

California Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 554388

Reported Deaths: 10307
CountyConfirmedDeaths
Los Angeles2067784967
Riverside40452799
Orange39076720
San Bernardino35452502
San Diego31779586
Kern22626171
Fresno17031171
Alameda13213208
San Joaquin12303211
Santa Clara11475203
Sacramento10795161
Tulare10475196
Imperial9693244
Stanislaus9566161
Contra Costa9022138
Ventura814689
San Francisco743267
Santa Barbara670469
San Mateo6110120
Marin528779
Monterey521235
Merced501264
Kings445356
Solano402940
Sonoma343147
Madera230239
Placer218620
San Luis Obispo209315
Yolo169043
Santa Cruz12386
Butte10958
Napa104610
Sutter9217
El Dorado7291
San Benito7094
Lassen6380
Yuba5884
Shasta41810
Mendocino38010
Colusa3624
Glenn3603
Nevada3221
Humboldt2824
Tehama2761
Lake2202
Amador1642
Mono1531
Tuolumne1522
Calaveras1471
Del Norte990
Siskiyou930
Inyo643
Mariposa602
Plumas340
Modoc50
Trinity50
Sierra30
Alpine20
Unassigned00
Chico
Few Clouds
99° wxIcon
Hi: 103° Lo: 71°
Feels Like: 99°
Oroville
Clear
98° wxIcon
Hi: 103° Lo: 71°
Feels Like: 98°
Paradise
Few Clouds
99° wxIcon
Hi: 96° Lo: 72°
Feels Like: 99°
Chester
Clear
89° wxIcon
Hi: 89° Lo: 61°
Feels Like: 89°
Red Bluff
Clear
105° wxIcon
Hi: 107° Lo: 73°
Feels Like: 105°
Willows
Few Clouds
99° wxIcon
Hi: 106° Lo: 67°
Feels Like: 99°
After a couple days of comfortably cooler than average weather around northern California, highs rose rapidly to more seasonable levels this afternoon. The warming trend will continue through the weekend, too.
KHSL Severe
KHSL Radar
KHSL Temperatures

Community Events