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Earnings Preview: Apple to report 3Q results

Associated Press Published: July 20, 2012

NEW YORK (AP) — Apple Inc. is expected to report a healthy increase in earnings and revenue for its fiscal third quarter on Tuesday, but investors are already looking ahead to the big event of the year: the launch of a new iPhone model.

WHAT TO WATCH FOR: The latest iPhone model, the 4S, was launched last year and is getting long in the tooth. Analysts expect that Apple shipments to have dipped substantially in the just-ended quarter.

Brian White at Topeka Capital Markets expects Apple to report selling 30.9 million units, while Andy Hargreaves at Pacific Crest expects it to report selling 25.4 million. In the second quarter, Apple shipped 35 million.

The trend in iPads is expected to be stronger, since Apple launched the latest model just two weeks before the start of the quarter. White expects it to have shipped 15.9 million units, which would be a record, while Hargreaves expects it to have shipped 14.3 million. That would beat the second quarter but not the holiday-fueled first quarter.

The company doesn't announce new products on its financial conference calls, but analysts are sure to probe executives for clues as to how fast the company can ramp production of the iPhone 5.

"We expect the product to be supply constrained for several months, which suggests that component supply and production capacity are likely to dictate Apple's (October to March) earnings power and the direction of its stock," Hargreaves wrote.

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