What to watch for in Apple’s earnings

When Apple reports earnings on Tuesday after the bell, Wall Street is expecting CEO Tim Cook to make good on his promise to return the company to growth.
This time last year, Apple reported a record quarter, with sales of iPhones at an all-time high. After that, it reported three straight quarters of lower year-over-year sales, adding up to its first yearly decline since 2001. In October, Cook said he thought Apple could make a comeback.
Analysts polled by Thomson Reuters seem to agree with Cook, at least in part: They expect adjusted earnings of $3.22 a share in the first fiscal quarter, down 1.8 percent from a year ago, on revenue of $77.38 billion, up 2 percent from a year ago, barring any revisions.
Much hinges on sales of Apple's new flagship phone, the iPhone 7, during the holiday shopping season. Analysts surveyed by FactSet expect that 77 million total iPhone units shipped during the quarter, up from 75 million in the year-ago period.
The iPhone's performance in China will be especially crucial, after Cook said last quarter he was "very bullish" on the Asian nation.
The company's software and services, like Apple Music and the App Store, could also help supplement iPhone sales. Services revenue grew 24 percent to an all-time quarterly record of $6.3 billion, the company said last quarter, and the App Store hit a record on New Year's Day.

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