What to expect when Apple reports earnings Monday

Apple will report fourth-quarter earnings Monday, but it’s not what happened last quarter that Wall Street really cares about.

Wall Street expects that Apple’s growth continued to slow for the quarter that ended Sept. 30. Consensus analyst forecast is that Apple will report revenue of $37 billion, up about 4% from a year ago. And the company is expected to post a profit of $7.2 billion, or $7.92 per share, down 12% from $8.2 billion, or $8.67 per share, for the same quarter last year.

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Sure, analysts will be looking for more clarity on the launch of the iPhone 5s and iPhone 5c. They already have low expectations for iPad sales, which declined in the third quarter for the first time ever. But overall, the results of the fourth quarter will provide an incomplete picture of the current state of Apple.

That’s because, in part, sales of things like iPhones and iPad can slow as consumers anticipate the new versions. And now that Apple squeezes all its product launches in a six-week stretch, that slowdown can be felt even more in a single quarter.

Also, the new iPhones were only on sale for the last 10 days of the fourth quarter. And the new iPads, announced last week, haven’t gone on sale yet.

What analysts really want to hear about are projections for the current quarter, the first quarter of fiscal year 2014.

In that regard, there’s growing optimism about Apple’s outlook.

“After a year to forget in FY:13 with our forecast for EPS to fall for the first time since FY:03, we expect EPS growth to return in FY:14 for a year that we believe will prove to be one of innovation,” wrote Cantor Fitzgerald analyst Brian White in a note to clients.

Indeed, investors seem to be sharing the belief that Apple is back on course after a tough year that saw its growth slow. Since the stock hit a low of $390.53 earlier this past spring, it was trading at $525.96 at the end of last week.

Still, there are four big things analysts are hoping that Apple will address today when it reports earnings after the markets close:

1. iPhone 5s: Apple is increasingly dependent on iPhone sales for most of its sales and profits. Since the iPhone 5s went on sale last month, its availability has been limited. Analysts will be looking for more details about the pace of manufacturing and whether supply of the new phones will catch up to demand any time soon. Last year, it took Apple a couple of quarters to get supply and demand in balance for the iPhone 5, with executives saying the company could have sold more phones and tablets if it would have made more.

“We believe [Apple’s] … guide may depend heavily on whether iPhone 5s supply improves,” wrote Gene Munster, a Piper Jaffray analyst, in a note to clients.

2. iPad Mini: Since its introduction last year, the iPad Mini has become the more popular of the two iPad options. But after introducing the second-generation iPad Mini with a Retina screen this month, the company has only said the device will be available later in November. This has led analysts to worry that supplies of Retina screens are limited, and that even when it goes on sale, Apple will have a hard time meeting demand. Analysts will be looking for any more scraps of information on the situation, including a sale date, they can get.

3. China Mobile: This remains a big opportunity if Apple can close a deal with China’s largest mobile company. Rumors are that a deal is imminent, but analysts have been waiting for an announcement for some time now. Getting such an agreement would immediately force everyone to rethink their estimates for Apple’s growth going forward. The chances of Apple giving any information on this issue today is probably slim.

4. New products: As always, this remains the big wild card, and also the area where Apple is least likely to say anything. Some analysts believe Apple has a new, bigger iPhone in the works that it will announce sometime in the first half of next year. Others believe a bigger iPad could be in the works. Of course, take that with a grain of salt. Last year, everyone thought Apple was working on a cheaper iPhone, which turned out not to be true.

Beyond evolution of current products, there’s the ever-present hope that Apple will finally roll out the iWatch, or debut some kind of expanded Apple TV product that will create a new market to fuel the company’s growth.

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