Apple (AAPL) earnings Q2 2020

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Tim Cook, chief executive officer of Apple Inc., speaks during an event at the Steve Jobs Theater in Cupertino, California, U.S., on Monday, March 25, 2019.

David Paul Morris | Bloomberg | Getty Images

Apple is set to report its second quarter earnings after the bell. In February, the consumer electronics giant withdrew its quarterly guidance as the Covid-19 coronavirus spread in China.

Wall Street is anticipating earnings of $2.26 per share on revenue of $54.54 billion, based on Refinitiv consensus estimates. However, it’s difficult to compare reported earnings to analyst estimates for Apple’s second quarter, as the coronavirus pandemic continues to chill global economies and makes earnings impact difficult to assess. 

Apple withdrew its guidance based on the demand and production impact in China in the early days of the pandemic. But since then, the coronavirus has spread to other countries, many of which are facing lockdowns or restrictions on movement and business. That could chill demand for Apple’s expensive phones and laptops.

Apple’s stores around the world, except in China and one location in Korea, are shuttered until further notice. Apple’s critical engineers and designers are working from home as the company’s headquarters of Santa Clara County has recommended through the end of May. Its annual developers conference in June, WWDC, has moved to an online format. 

Yet Apple continued to launch products during the March quarter, suggesting that it can stabilize its supply chain and continue business, if not as usual, close to it. It launched a new iPad Pro model with a $299 keyboard accessory, as well as a $999 MacBook Air laptop. In April, after the quarter ended, Apple launched a new low-cost phone, the iPhone SE, which retails for $399.

The second quarter is typically when Apple tells investors about its annual plans for buybacks and dividends. In Apple’s fiscal 2019, it spent $67.1 billion repurchasing shares and $14.1 billion on dividends. Public companies are suspending buybacks both for political and practical reasons during the pandemic, although Apple in particular remains in a strong fiscal position, with $207.06 billion in cash on hand at the start of the calendar year. 

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