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Consensus estimates project Apple to report approximately $138.4 billion in revenue for the December quarter (fiscal Q1 2026), along with both GAAP and non-GAAP earnings per share (EPS) of around $2.67. These figures reflect at least 11% year-over-year growth in both revenue and EPS.

However, analysts have recently become more cautious on margins, adjusting forecasts downward despite positive momentum in iPhone sales and Apple’s AI initiatives.

In a client note, Morgan Stanley analyst Erik Woodring expressed confidence that Apple will surpass expectations, primarily due to stronger and more sustained demand for the iPhone. Citing supply-chain data and shipment checks, Woodring forecasts December-quarter revenue of $139.8 billion, with the iPhone contributing $80.2 billion, and services totaling $29.9 billion.

Aparajita Chatterjee for The Street:
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He said iPhone 17’s “strength remains underappreciated by the Street.”

Morgan Stanley sees cost assumptions as overly optimistic. The firm forecasts March-quarter operating expenses about 7% above consensus and a gross margin forecast 30 basis points below consensus, driven by rising memory costs…

All things considered, Morgan Stanley believes Apple is positioned to outperform in 2026 as a wave of new products and AI-driven catalysts is set to shape the company’s growth trajectory. The firm particularly highlighted the relaunch of Siri in February and Apple Intelligence in June at Apple’s Worldwide Developers’ Conference (WWDC).

Some notable introductions expected include its most “innovative iPhone in 10+ years (Foldable)“, plus the first smartphone powered by 2-nanometer chips, part of the iPhone 18 family.

The firm sees greater benefits from share gains and higher average selling prices, with Morgan Stanley underscoring an EPS of $9.77 for FY2027, roughly 7% above Wall Street consensus.

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Apple and, indeed, the entire U.S. economy, are primed to roar in 2026!

As usual, we’ll bring you Apple’s results as soon as they are released, right around 1:30 p.m. PT / 4:30 p.m. ET on Thursday, January 29, 2026 and then follow with live notes from Apple’s conference call at 2:00 p.m. PT / 5:00 p.m. ET.

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Source link: https://macdailynews.com/2026/01/27/morgan-stanley-expects-apples-earnings-to-beat-expectations/

Apple today released iOS 26.2.1 and watchOS 26.2.1, minor point updates to its mobile and wearable operating systems that primarily introduce support for the newly announced second-generation AirTag, often referred to as AirTag 2.

The updates arrive on the same day Apple unveiled the refreshed AirTag accessory, which brings meaningful hardware improvements after nearly five years since the original model’s debut in 2021. The new AirTag features a second-generation Ultra Wideband chip that delivers up to 1.5x greater Precision Finding range, a speaker that’s reportedly 50% louder for easier audible locating, expanded overall connectivity range, and other enhancements to make tracking lost items more reliable and effective.

iOS 26.2.1 adds full compatibility and optimized support for these AirTag 2 capabilities on compatible iPhones. Users with the new tracker will benefit from improved directional guidance and distance accuracy when using the Find My app’s Precision Finding feature.

Similarly, watchOS 26.2.1 enables Precision Finding directly on the Apple Watch for the new AirTag. This functionality requires an Apple Watch Series 9 or later, or Apple Watch Ultra 2 or later. For the first time, users can leverage the wrist-worn device’s haptic and directional cues to zero in on a misplaced item with greater precision, without needing to pull out their iPhone.

Beyond AirTag 2 support, both updates include standard bug fixes, performance optimizations, and under-the-hood improvements. Apple recommends that all eligible users install the software to ensure the best experience with existing features and new hardware.

The second-generation AirTag is available starting today from Apple.com, Apple retail stores, and authorized resellers.

These incremental releases follow iOS 26.2 and watchOS 26.2, which launched in mid-December 2025 as part of Apple’s regular update cadence for the iOS 26 era. Apple Intelligence features, Liquid Glass design elements, and other major additions introduced in iOS 26 remain unchanged in today’s point release.

How to update:

• iPhone and iPad users can download iOS 26.2.1 (and the corresponding iPadOS 26.2.1) by navigating to Settings > General > Software Update.

• Apple Watch owners can update to watchOS 26.2.1 via the Watch app on a paired iPhone under General > Software Update, or directly on the watch through Settings > General > Software Update (requires the device to be charging and in range of Wi-Fi).

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Source link: https://macdailynews.com/2026/01/26/apple-releases-ios-26-2-1-and-watchos-26-2-1-with-airtag-2-support/