Apple hits 4-month high as iPhone assembler Foxconn boosts sales outlook

Apple's key supply chain partner just boosted its sales outlook, suggesting solid demand for iPhones, tablets and PCs over the holiday season.

Dec 5, 2023 - 23:30

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Apple hits 4-month high as iPhone assembler Foxconn boosts sales outlook

Updated at 12:12 PM EST

Apple (AAPL) - Get Free Report shares hit the highest levels in four months Tuesday after the group's key iPhone assembly partner, Taiwan-based Foxconn, lifted its fourth-quarter growth forecasts amid improving consumer demand.

Foxconn, arguably the most important company is Apple's global supply chain, said current quarter revenues would be better than its early autumn forecast for "significant" growth.

The company cited better-than-expected demand for smartphones, tablets and other consumer electronics over the months of October and November.

The second half of the year is the traditional peak season for the [information and communication technology] industry," Foxconn said in a statement emailed to TheStreet. "Revenue performance in the first two months of the fourth quarter has been slightly higher than expected."

"Therefore, the outlook for the fourth quarter should be better than the original guidance for "significant growth," Foxconn added.

Apple shares at last check were marked 2.1% higher to change hands at $193.36 each, a move that would peg the stock's 2023 gain at around 55%. The shares touched a four-month high of $194.40 earlier in the session.

Demand projections for the U.S. market could be complicated by a muted assessment of Black Friday sales, however, which according to estimates from the National Retail Federation rose at the slowest pace in five years.

Last month, Best Buy (BBY) - Get Free Report, one of Apple's key U.S. retail partners, cautioned investors that "consumer demand has been even more uneven and difficult to predict" heading into the holiday season, thanks in part to elevated inflation, the resumption of student loan payments and a weakening job market."

Foxconn's earlier projection: 'significant' gains

Earlier this fall, the world's biggest iPhone assembler noted 'significant' month-on-month gains ahead of the expected demand surge from both the November Singles Day shopping event in China and the Black Friday holiday shopping in the U.S.

Apple said December-quarter sales would likely be flat with the year earlier's $117 billion total. The forecast fell shy of Wall Street forecasts of a 5% gain and followed the tech giant's fourth consecutive sequential revenue decline and big pullbacks in Mac, iPad and Apple Watch sales.

Group revenue ticked down 0.7% to $89.5 billion, just ahead of the Wall Street consensus forecast of $89.3 billion. IPhone sales surprised to the upside with a 2.8% gain and a $43.81 billion total.

Earnings for the quarter were up 13% to $1.46 a share, powered for the most part by solid services revenue – Apple's widest-margin business – and a record overall total for its global installed user base.