Apple's fiscal fourth-quarter App Store revenue is projected to have increased by a double-digit percentage, according to UBS Securities. The anticipated growth comes amid a challenging comparative landscape ahead. Specifically, App Store revenue is expected to have risen by 13.4% in the September quarter, marking a commendable fifth consecutive quarter of growth ranging between 12% and 13%.
This positive trend is attributed to notable sales increases in the United States and global markets, estimated at 14.4% and 12.8%, respectively. In the same quarter of the previous year, Apple's global App Store sales increased by 12.4%, with more favorable comparisons before that, according to UBS data. Analysts David Vogt and Andrew Spinola advised that, moving forward and excluding the outlier month of January, the App Store could face more significant challenges in the low-to-mid teens percentile range.
This scenario may restrict the potential for growth in the services segment, they cautioned in a note to clients. During the third quarter, Apple witnessed a remarkable surge in services revenue, which jumped by 14% year-over-year, reaching an unprecedented $24.2 billion, as reported by Chief Financial Officer Luca Maestri during an earnings conference call in August.
The company had projected that fourth-quarter services sales would also reflect double-digit growth “at a rate similar to what we reported in the first three quarters of this fiscal year.” UBS expressed confidence in its and Wall Street's prediction of fourth-quarter services sales growth, estimating rates of 13% and 13.2%, respectively.
The brokerage currently maintains a neutral rating on Apple stock with a price target of $236. Scheduled to report its fourth-quarter financial results on October 31, Apple is under the watchful eyes of analysts polled by Capital IQ, who anticipate GAAP earnings of $1.59 per share on revenue of $94.22 billion.
This follows a previous year where Apple posted EPS of $1.46 and net sales of $89.5 billion. Current Stock Price: $226.22, Change: +0.55, Percent Change: +0.24.