AAPL -3%: GM guide (45.5% vs bogeys of 46%) the biggest issue from the call & mgmt didn’t make it sound like the problem ends in December. Services guide also missed while total rev guide was better (8.5% vs bogeys of 5%). Stock faded a minute after the Services and GM guides, and hit its low (-4.5%) as the CFO finished his GM answer. Ternus called memory pricing “unprecedented” and sees it “continuing to increase” after December, with no number on it. Carry-in inventory help is fading, tariff refunds are mostly done, and Siri AI adds cloud costs and revenue deferrals. On Services, the CFO put the Dec slowdown on “third-party licensing” and FX. FX is only ~0.5pt of the 1.3pt slowdown, so licensing is most of it. He also said the App Store was “similar to the prior year” in Sept. No Dec color on iPhone or China.
Fast money was short heading in, so bears are hanging their hat on the GM/Services miss, and Street still has 47.6% GM for March, ~2pt above the Dec guide mid. Unclear if that’s…