Apple points to strong profits despite supply constraints and Omicron

Apple handled pandemic-related supply chain issues better than rivals in late 2021, which likely helped the company beat Wall Street’s expectations of 6% revenue growth, analysts estimate.

Apple, which is due to report quarterly results on Thursday, has had strong global sales of the iPhone 13, strong sales in China and continued growth in computers, several analysts told Reuters.

“We expect Apple to achieve its biggest market share in China since the company entered the market in 2008,” said analyst Nicole Peng of Canalys.

Investment firm Wedbush Securities estimates that Apple recorded record iPhone sales of more than 40 million units during the period from Black Friday to Christmas. Morgan Stanley estimates that total iPhone sales for the Christmas quarter were 83 million, representing a 4% increase over the previous year.

Wall Street analysts expect Apple to have posted sales of about $118.7 billion, representing a 6.48% year-over-year growth, and quarterly earnings per share of $1.89, according to Refinitiv data.

Preliminary data for the last quarter of last year, compiled by market research firm IDC, indicates a growth of nearly 9% in sales of Mac computers, compared with a 1% increase in the PC market as a whole.

Analysts played down concerns about the impacts of the Omicron variant, saying the closure of some retail stores likely didn’t have a big impact on Apple’s business. Analysts are also on the lookout for signs that the rise in Omicron cases in China could affect Apple’s production.

The company, the first company to be worth $3 trillion, has been losing market value along with Wall Street in general. Apple shares are down 10% this month and the S&P 500 index is down 9%.