TLDR
- Apple reports Q1 fiscal 2026 earnings January 29 with Wall Street projecting $2.67 EPS and $138 billion revenue, up 11.3% year-over-year
- Analyst consensus shows Moderate Buy with average $298 price target implying 20% upside despite 8-9% decline in 2026
- Morgan Stanley maintains $315 Overweight rating but forecasts iPhone revenue 4-8% above Street estimates for December and March quarters
- KeyBanc holds cautious stance warning second-half growth expectations may be too optimistic despite strong near-term trends
- Memory cost pressures and higher operating expenses could offset iPhone 17 strength in coming quarters
Apple’s fiscal first quarter results arrive January 29. Analysts expect solid numbers but question whether the momentum lasts.
Wall Street forecasts $2.67 in earnings per share on $138 billion revenue. Both figures mark 11.3% increases from the prior year. iPhone 17 sales and Services revenue fuel the projected growth.
Shares have dropped 8-9% this year heading into the report. The average analyst price target sits at $298, suggesting 20% potential upside. The rating breakdown shows 19 Buy calls, 11 Hold ratings, and 2 Sell recommendations.
Morgan Stanley keeps its Overweight rating with a $315 target. The firm argues iPhone 17 performance exceeds most Wall Street estimates. Its revenue projections for iPhones run 4-8% higher than consensus for both December and March periods.
But Morgan Stanley adds an important caveat. The bank expects shares to trade flat or slightly lower after earnings despite the positive iPhone outlook.
Expense and Margin Pressures Build
Multiple factors could prevent upward earnings revisions. Morgan Stanley calculates that consensus underestimates March quarter operating expenses by 7%. The firm also sees gross margins coming in 30 basis points below Street projections.
Rising memory costs present another challenge. June quarter EPS estimates don’t fully account for these intensifying headwinds. Historical data shows Apple typically underperforms the S&P 500 by 400 basis points during the first calendar quarter.
Goldman Sachs holds a more optimistic view. The bank reiterates its Buy rating at $320 after the stock’s recent 5% decline. Goldman sees the pullback as an entry point and forecasts 9% iPhone revenue growth for both fiscal 2026 and 2027. The bank projects $2.66 EPS for the current quarter, matching FactSet consensus.
Divided Views on Second-Half Outlook
KeyBanc analyst Brandon Nispel maintains a Hold rating with concerns about excessive optimism. While acknowledging healthy iPhone and Mac trends including higher average selling prices and strong production builds, Nispel questions whether second-half growth and margin expectations are realistic.
UBS stays Neutral with a $280 price target. The firm estimates December 2025 iPhone unit sales reached 84.5-85.0 million, confirming robust demand for the iPhone 17 lineup.
Institutional investors dominate Apple’s shareholder base. Vanguard ranks among the largest holders. Individual investors and public companies control just over 61% of shares.
New Products in Development Pipeline
Apple continues expanding beyond its core offerings. The company works on an AI-powered wearable pin featuring multiple cameras, speaker, microphones, and wireless charging capabilities.
Negotiations with Mastercard and Visa progress regarding a digital payments service launch in India. The phased rollout could begin in 2026 pending regulatory approvals.
December quarter iPhone data supports the bullish production outlook. Strong unit sales indicate sustained consumer demand for the latest device lineup. Services revenue continues growing at higher margins than hardware sales.
Morgan Stanley’s iPhone revenue forecasts exceed consensus by meaningful margins. Yet the firm balances this optimism against rising cost pressures that could squeeze profitability in coming quarters.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
