Apple Earnings: What We're Watching

Apple (NASDAQ: AAPL) reports tonight. We expect a strong earnings report but the key metric may be iPhone units.

iPhone units accelerated on a one-year basis last quarter but actually slowed on a two-year basis.

iPhone being the most important driver to the overall business forces analysts to watch this key metric.

Here's the last few quarters iPhone unit data.

(Click on image to enlarge)

You see last quarter's pick up to 2.9% but adding up the last two year's growth rate the trend slowed from Q1. We look at the two year because you can catch an underlying trend that cancels out one-timers from a year ago.

Comparisons get tougher now also. June last year was up 1.6% versus March -.8%. So this year's June growth number gets a little tougher to come by when lapping higher year-ago numbers.

We'd expect a good guide because iPhone was late last year and hopefully won't be this year.

Net we'd expect a good report but the key to watch is the iPhone unit trajectory.