Bernstein keeps Market Perform on Apple, says Q1 likely not great

In a research note ahead of Apple’s quarterly results, Bernstein says the firm is largely in line with consensus on revenues and EPS for Q1. Q1 guidance pointed to a weak iPhone 15 cycle, with company revenue up 32.7% compared to Q4, among the weakest in history, despite improved iPhone supply. While services is likely to continue to see strong growth, the firm believes that Apple’s other product categories will also be weak. Looking forward, Bernstein thinks consensus is mis-modeling iPhone seasonality, and is notably below consensus revenues for Q2 and the remainder of the year. Given that there is widespread investor sentiment that the iPhone 15 is a weak cycle, the firm says a key question is whether tepid results and guidance are already priced in, similar to the iPhone XS and 14 cycles, where Apple strongly outperformed from Q1 results through year end. Bernstein has a Market Perform on the shares with a price target of $195.