AAPL -- Crushes Estimates -- Shares Surge -- Best June Quarter Ever -- July 31, 2018

Updates

August 2, 2018: Wall Street Journal when Apple hits $1 trillion market cap.

Original Post

3:44 p.m. CDT: shares up over $5.00 / share.

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It's 3:30 p.m. -- do you know what Apple's earnings are?

Somebody knows something. Shares jump. Up $3.99 before CNBC announced.

• holy mackerel -- every number is incredible:
• EPS: $2.34 vs $2.18
• revenue beat: $53.27 billion vs $52.34 billion
• average selling price of iPhone incredible
• guidance, for next quarter: $60- $62 billion
• 38% gross margin guidance 
• Cook: underlying demand is even greater 
• iPhone X most popular version in urban China
• $724 average selling price -- $30 above Wall Street estimate -- huge
• Chinese growth, 19%
• global services growth: 31% 
• cash hoard falls $23.5 to $243.7 billion
• iPhone shipments for the quarter down slightly; remember: Apple getting ready for huge new release of new iPhones -- including one to replace the iPhone X

Pre-release share action:

• AAPL closed slightly up during regular hours, but essentially flat --
• AAPL is up slightly after hours, but essentially flat --
• because the movement on AAPL was so minimal during regular hours and now after hours, less than 30 minutes before earnings announcement, my hunch: AAPL is going to move $3 to $5/share one way or the other once the numbers are released (posted, 3:19 p.m. CDT, July 31, 2018); if history is any guide, AAPL will drop $3/share (or more) once earnings are released
• if shares drop today, AAPL shares will gradually recover over the next few weeks
• if shares jump today, AAPL shares will continue to surge through the end of the week

Pandora: Leading up to release of Apple's earning: Pandora -- (posted 3:12 p.m. CDT, July 31, 2018)

• shares surge 5%; shares have dropped about 25% this past 12 months
• active listeners (subscribers) greater than expected
• revenue beat: $384 million vs $373 million forecast
• EPS beat by one penny: a loss of 15 cents vs a forecast of a loss of 16 cents
• I don't believe Apple breaks out Apple Music data
• an increase in Pandora listeners is a good omen for all music platforms

Cheesecake Factory: "Penny, Penny, Penny -- what happened?" asks Sheldon.  Cheesecake Factory reports a huge miss; shares down 5% in after hour trade. Adds to 2% loss during regular hours.

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Apple -- Before Earnings Release

Some of this was previously posted.

Earnings forecast: $2.18. Range: $2.10 - $2.28/share.

The third quarter earnings for past years have been circled in the graphic below; easy to read.

But let's look at revenue (link here):

• average: $52.34 billion
• range: $49 - $53.49 billion
• $52.34 billion will be the best quarter ever except for first quarters which is always Apple's best quarter, with three exceptions:
• 4Q17: $52.6 billion
• 2Q17: $52.9 billion
• 2Q15: $58 billion -- iPhone 6 and IOS 8.0 released in September, 2014, perhaps the biggest update since the iPhone was first released

If AAPL meets consensus, it will be the second best showing for the 3Q in the last several years: