Expectations are perhaps higher than ever for Apple’s biggest cash cow, the iPhone, to deliver big sales this year.
Analysts polled by Thomson Reuters expected Apple to forecast $49.21 billion in revenue in the company’s fiscal fourth quarter, while analysts polled by StreetAccount expected flat profit margins of 38.3 percent.
The iPhone 8 — the phone that would mark the 10th anniversary of the original model — is expected to introduce radical new features such as brighter, edge-to-edge screens and augmented reality capabilities as soon as September. Plus, there’s a slew of people with sixth-generation iPhones — one of Apple’s best sellers — that might be due for an upgrade.
All these rumors have dampened excitement for Apple’s current model, the iPhone 7, CEO Tim Cook said earlier this year. And unconfirmed reports of manufacturing delays have added an extra layer of uncertainty to the mix.
Nonetheless, analysts have speculated that features like voice compatibility with the new HomePod speaker could make Apple’s ecosystem more useful for consumers, boosting Apple’s ability to sell services like Apple Music.
Still, the company is not without challenges, especially in China, where sales fell 14 percent year-over-year last quarter. Local competitors such as Huawei and Xiaomi have pressured Apple’s market share, while Apple has added executives and bent to accommodate regulators in Beijing.
The American political landscape may play an even greater role in Apple’s future. Cook has been an outspoken critic of the U.S. tax code, and has rallied behind issues such as encryption, gay and transgender rights, immigration, education and the environment.
But with a giant pile of cash held mostly overseas, Apple could be a big beneficiary of change at the White House.
— CNBC’s Josh Lipton and Rachel Cao contributed to this report.