Apple Inc. (NASDAQ: AAPL) announced earnings results for Q2 2020 today that were ahead of reduced analyst estimates. The stock is down -1% in after hour trading.

Revenue came in at $58.3 billion, which beat analysts’ estimates of $54.64 billion (+7% vs consensus).

EPS came in at $2.55, which beat analysts’ estimates of $2.26 (+13% vs consensus).

Wall Street analysts had slashed Apple earnings estimates by 25% since the beginning of the year as a result of the coronavirus pandemic.  Apple announced on February 17th that it did not expected to achieve it’s Q2 revenue guidance ($63-67 billion) as a result of supply constrains and lower demand from China.

Source: YCharts

Product revenue came in at $44.96 billion, down -3.5 % year-over-year (YoY). Service revenue came in at $13.35 billion, an increase of +17% YoY.  Overall net sales were up 0.5% at $58.3 billion.

Operating margins contracted in the quarter to 22.0%, a reduction of 100bps from the previous year.

Source: YCharts

On a valuation basis Apple has Forward P/E multiple has increased by 11% since the beginning of the year, in comparison Amazon’s Forward P/E multiple has increased by 40%.

Source: YCharts

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