Cirrus Logic (CRUS) Q1 earnings preview: A focus on September guidance and iPhone 16 impact

In the wake of Apple's recent Q3 report, all eyes are on Cirrus Logic (NASDAQ: CRUS) as the chipmaker prepares to release its Q1 (June) earnings after the close. With Apple (NASDAQ: AAPL) accounting for a significant portion of Cirrus Logic's sales, the two companies' fortunes are intrinsically linked. Analysts are eagerly awaiting the quarterly update, especially given the traditionally slow June quarter for iPhone sales.

Current consensus expects Cirrus Logic to report a year-over-year decline in EPS of 9%, with revenue growing marginally by 0.4% to $318.4 million.

The company's guidance for the quarter, which tends to be conservative, is expected to range from $290 to $350 million, with a GAAP gross margin of 49-51%. This wide range reflects the uncertainty surrounding the iPhone 16's potential impact on sales.

Apple's Q3 results, while meeting expectations, showcased steady iPhone performance, despite a slight year-over-year revenue decrease.

As the market awaits the September launch of the iPhone 16, investors will likely place greater emphasis on the September quarter's guidance for Cirrus Logic. Analysts have historically seen beats in CRUS's EPS, with recent quarters experiencing significant upward deviation from initial estimates.

Shares of CRUS have witnessed a 19% decline since mid-July, mirroring the broader tech sector's downturn.

However, the focus will be on the guidance provided for the September quarter, as the timing of the new iPhone release often drives revenue growth in the following period.

Investors should pay close attention to any potential adjustments in guidance and any insights into Cirrus Logic's expanding mixed-signal business, particularly in the fast-charging segment.

The lion's share of the earnings preview will center around how the company's growth prospects and the iPhone 16's success will shape its future earnings trajectory.

As the earnings call unfolds, investors will be looking for a balanced assessment of the near-term challenges and the potential for long-term growth, with the September guidance serving as a crucial indicator of the stock's investment value.

The market's reaction to the earnings report will provide further insight into investor sentiment and the broader tech sector's outlook.

Cirrus Logic's Q1 earnings report will be pivotal in understanding the company's position amidst a dynamic market environment. The focus on September guidance and the impact of the upcoming iPhone 16 will be key factors in determining the stock's future performance.

Investors should stay tuned for a detailed analysis of Cirrus Logic's Q1 results and the implications for the company's growth potential moving forward.