A Yellow Flag Has Been Raised

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Mac sales have been through the roof since the start of the pandemic, but the growth pace may be slowing down fast. Here is what to expect of the Mac on Apple’s upcoming earnings day.

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The Apple Maven continues to preview Apple’s fiscal third quarter earnings season. Up to this point, we have addressed the following topics:

  1. Wall Street’s expectations for revenues and earnings;
  2. The expected performance of the iPhone in the quarter;
  3. How the iPad could be the star of the show this time;
  4. What history says about trading AAPL around earnings day.

This time, we turn to a less encouraging piece of news regarding the Mac segment. Research company IDC reported that the increase in personal computer shipments continued in the second calendar quarter of 2021. However, growth has decelerated sharply from the previous quarters.

Could this be the end of a period of dizzying growth in Mac sales? And if so, will Apple stock  (AAPL) – Get Report take a hit?



Figure 1: New Mac lineup.


© Provided by Apple Maven on The Street
Figure 1: New Mac lineup.

(Read more from the Apple Maven: History Says: Buy Apple Stock Before Earnings)

Good news first

IDC’s numbers on Q2 PC sales can be interpreted in a couple of ways. The good news is that shipments increased by 13% year-over-year. This is not bad, considering that desktops have been disrupted by laptops, which in turn have been disrupted by powerful mobile devices in the past years.

Also, keep in mind that the supply chain has been impacted by the shortage in tech components, as global economies jumpstart their activities following the worst of the pandemic. On top of 11% growth in Q2 of last year, the most recent quarter’s numbers seem far from disastrous.

Now, the bad news

That said, Apple did not look particularly good on IDC’s most recent report. First, the Cupertino company is believed to have lost market share since this time last year: 7.4% vs. 7.6%. The sub-10% growth in Mac shipments only lagged the performance of HP’s devices among the top 5 vendors (see table below).



table: Figure 2: IDC quarterly personal computing device tracker, July 12, 2021.


© Provided by Apple Maven on The Street
Figure 2: IDC quarterly personal computing device tracker, July 12, 2021.

Second, from an investor sentiment perspective,…

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