The Maestri Code, Q3 2014, Part 3: “More of the Same”

In my humble opinion?

Don’t expect any big surprises in actual results, given Apple’s guided operating expenses range of $4.4-$4.5B, and don’t be surprised if OpEx guidance for Q4 is around the same, give or take a couple hundred million dollars.

Next time, the quarterly operating margin and gross margin check-up!

…wait, is that it? Well, I guess that depends on if you want to read on past the jump. 😀


Thanks for clicking! It’s another fairly quick read as we wait for (a) “four-quarter” validation of my stair-step OpEx theory, and (b) Q1 2015 OpEx guidance, which…well…I think you know what I’m getting at by now. 😉

Let’s update the Oppenheimer’s-OpEx-guidance-range-vs.-actual section from last quarter.

Q1 2013 (Fiscal calendar): Point guidance – $4.05B; actual $3.85B – guidance $200M / 5.2% higher than actual

Q2 2013: $3.8-3.9B; actual $3.791B – guidance was $9M / 0.2% higher than actual (based on lowest point in the range)

Q3 2013: $3.85-3.95B; actual $3.823B – guidance was $27M / 0.7% higher than actual (based on lowest point in the range)

Q4 2013: $3.9-3.95B; actual $3.841B – guidance was $59M / 1.5% higher than actual (based on lowest point in the range)

Q1 2014: $4.4-4.5B; actual $4.383B – guidance was $17M / 0.4% higher than actual (based on lowest point in the range)

Q2 2014: $4.3-4.4B; actual $4.354B – (low-end) guidance was $54M lower than actual

That’s…slightly different. While OpEx was well within guidance, actual OpEx was always below guidance until this past quarter. The “culprit”, so to speak? Mostly increased R&D spending, up $92M sequentially. SG&A spending decreased sequentially ($121M). Share-based compensation expense related to total OpEx increased “only” $14M increase sequentially, so it wasn’t really a driver of the “higher-than-you-might-expect” OpEx number.

Here’s the updated overall OpEx chart, along with my “estimate” that “should” be close to actual given that prior recent history holds. If anything, there’s a chance that my $4.42B OpEx guess is too high; for some reason, Apple seems intent on keeping its OpEx extremely consistent from quarter to quarter in a given fiscal year. Why? Only Maestri and Co. know.

aapl-opex-q3-2014-est

Next in my home gamer series – checking up on Apple’s overall gross margin and regional operating margins.

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