Wall Street Expects Record Profits At Apple Inc. (NASDAQ:AAPL)

Analysts are predicting that Apple Inc. (NASDAQ:AAPL) will report a minimum net income of $19 billion when the tech giant releases its quarterly financial report later this week setting the stage for the iPhone maker’s most profitable quarter ever in its corporate history. Apple’s quarter which ends in December 2017 will be the first one in which the Cupertino, California-based tech giant will be reporting iPhone X’s sales. The period that is set to be reported will beat its previous best quarter which was in 2015 when the tech giant registered a net income of $18 billion.

Last November executives of the iPhone maker indicated that they had high expectations that it would be the biggest quarter ever and that the results would market a return to an era of double-digit growth in revenues.

Best-selling smartphone

According to analysts at research firm Canalys, a total of 29 million iPhone Xs were shipped during the quarter. This made the iPhone X the best-selling smartphone across the globe during the holiday season. The analysts also estimate that a total of 81 million iPhones were sold during the period and this saw revenues grow by 11% to reach a figure of $86 billion.

Since shipments of iPhones are expected to comprise over two-thirds of the total sales of the tech giant, some analysts are of the view that the quarter will be even better. According to Morgan Stanley for instance, revenues of the iPhone maker will grow by 18% to reach a figure of $92 billion. The Wall Street firm also expects net income of Apple to come in at $21 billion. Due to the iPhone X’s high price as well as the fact that different iPhone models were released several weeks apart means that estimates vary widely.

Apple’s resilience

Part of the reason for Apple’s success is the fact that the tech giant responded well to the challenges that cropped up with regards to the iPhone X.

“Apple saw stellar iPhone X sales … Apple’s supply chain was able to ramp iPhone X production much faster than anyone expected,” said an Above Avalon analyst, Neil Cybart.

Besides the strong sales of the iPhone, the tax reforms carried out in the United States are expected to lead to an expansion of the company’s capital return programme.