Hello everyone. Welcome to a special Friday edition of the Above Avalon Daily. We will begin analyzing Apple’s 2Q24 earnings. There is a lot to unpack. The earnings review will take place across a few updates.

Key Takeaways From Apple’s 2Q24 Earnings

Heading into 2Q24 earnings, the expectations bar facing Apple had been set low. The company easily jumped over the hurdle. Both revenue and EPS beat consensus with revenue trending flat when excluding a one-time COVID impact. Gross margins are trending at levels that the company has not seen in over a decade. Apple provided 3Q24 guidance that suggested revenue growth will return. Everything is on track for FY24 to be something of a rebound year for Apple on the financial front. Under the hood, the Apple ecosystem continues to quietly expand as new users enter the fold and existing users move deeper into the ecosystem.

The Numbers

Here are Apple’s reported 2Q24 results versus my expectations with brief commentary for each item.

An Above Avalon membership is required to continue reading this update. Members can read the full update here. (Members: Daily Updates are accessible via the archive. If you haven’t logged into the archive before, fill out this form to receive an invite.)

Choose either a monthly or annual membership. Payment is hosted by MoonClerk and secured by Stripe. Apple Pay and other mobile payment options are accepted. After signup, use this link to update your payment information and membership status at any time. Contact me with any questions.

Subscribe $20/month

Subscribe $200/year

Contact me directly if you would like to purchase multiple subscriptions (five or more) for your team or company.

An audio version of the newsletter is available to members who have the podcast add-on attached to their membership. More information about the podcast add-on is found here. Special Inside Orchard bundle pricing is available for Above Avalon members. Additional membership customization is available via the Financial Models add-ons.