Mag 7 Earnings Week Continues with Apple (AAPL) in Today’s Postmarket
An exceptionally heavy earnings week rolls on with Apple (AAPL) rounding out the list of its fellow Magnificent 7 companies after today’s closing bell. The personal electronics giant follows mixed results from Microsoft (MSFT), Alphabet (GOOGL), Amazon (AMZN), and Meta Platforms (META), with Wall Street expectations for EPS of $1.92 against last year’s figure of $1.65 (+16.4%) and for revenue of $109.48B vs. $95.36B year-over-year (+14.8%).
Traders continue to digest news of CEO Tim Cook’s departure, who will step down from the role in September when John Ternus, Senior Vice President of Hardware Engineering and a 25-year Apple veteran, moves into the top spot. Cook, who has been CEO since 2011, will still have an active role in the company as executive chairman. This is a significant transition when the tech sector (and really, the world as a whole) simultaneously muddles its way through a transformative period shaped by the rise of artificial intelligence. This nascent technology brings a host of opportunities and challenges, with one of the biggest near-term problems being the tremendous demand pressure on the semiconductor sector – specifically for memory, so investors likely will be watching closely for signals about whether Apple needs to raise prices to contend with this supply crunch.
In some ways, Apple has been a curious laggard in the A.I. field in general. While Apple Intelligence offers features that many other A.I. heavyweights also provide such as generative creative tools and text reading/proofing capabilities, its signature virtual assistant Siri is generally regarded as being capable at many basic tasks but struggling with complicated questions or detailed requests; so this likely will be a keenly watched area for any new announcements. Other things to watch, as always, include iPhone sales and demand, as well as the company’s level of success in China.
Apple’s chart has seen something of a sideways drift for the past two quarters. After hitting all-time highs of 288.62 on Dec. 3, shares sank back to a prior supportive level near 246 marked by a small gap on Sept. 19, which has been tested several times since then and held firm. More recently, shares slipped below a shorter-term upward trendline beginning with lows around this same 246 level from Apr. 7 after failing to retake a notable resistance area near 277 marked by a similar series of highs. Apple presently also sits near its yearly Volume Profile Point of Control at about 270, which marks the heaviest trading area in terms of volume and can present notable areas to watch for technical traders. Another especially large volume node has developed between about 255 to 260, so this could also represent a supportive area to watch if earnings disappoint.
Examining the options market, the May 1 weekly expiration that will capture today’s earnings projects a potential move of +/-10.2 (3.7%). This gives an upper boundary of near 281, which lines up closely with some relative intraday highs from early February. Meanwhile, the next monthly expiration for May 15 gives a +/-15.3 (5.6%) potential move, which suggest traders do not expect Apple to break above the all-time high during the next couple of weeks.
Featured Clips
