(Bloomberg) -- Apple (NASDAQ:AAPL) could see the number of iPhones sold slump by more than a third in the second quarter of the year, Goldman Sachs (NYSE:GS) estimated, downgrading its recommendation on the stock to sell from neutral.
Unit sales for iPhones are set to drop by 36% year-on-year in the second quarter as the economy takes a hit from the pandemic, before recovering to just a 2% decline by the fourth quarter of this year, analysts including Rod Hall wrote in a note. Weakness for average selling prices is also likely to linger, he said. Hall cut his price target on Apple to $233 from $250, the second-lowest among analysts tracked by Bloomberg.
Apple doesn’t report unit sales for its smartphone line anymore, but the firm is estimated to sell 28 million iPhones in the quarter ending in June, according to 7 analysts in a Bloomberg survey. A smaller consensus of 3 analysts signals a 27% drop from previous year.
Apple’s shares ticked 1% higher in U.S. pre-market trading, lagging behind a 3% gain on S&P 500 Index futures. Chief Executive Officer Tim Cook struck an optimistic tone about the company’s prospects following the pandemic, according to Apple employees who attended a virtual meeting on Thursday. The company plans to reopen its retail store in South Korea, the first location to come back online since it shuttered all 458 stores outside of China in March. Apple will release its fiscal second-quarter earnings on April 30.