FORTUNE — Today at about 4:30 p.m. Eastern, Apple (AAPL) will report its results for the March quarter, and the fog of rumors and speculation that has swirled around the company since January will lift — if only for a day or two.
This is Apple’s quarterly reality check, its chance to answer questions that have weighed on the company’s stock price since September, driving it down — as we are reminded almost hourly on the business news channels — from over $700 to below $400.
Among the issues the company will address:
- iPhones. How much has competition from Samsung cut into its smartphone franchise? In the March quarter last year, Apple generated nearly $22.7 billion from the sale of 35 million iPhones. Can the company beat those numbers? Most analysts assume they will, although the shift to lower-price models may cut into what has become Apple’s biggest revenue stream.
- iPads. How much steam has the iPad franchise lost? This time last year, Apple reported that it generated $6.6 billion on the sale of 11.8 million iPads, doubling its performance from the year before. In a market increasingly crowded with cheaper tablets, phablets and other distractions, can Apple maintain even half that rate of growth? And how much has the success of the iPad mini cut into sales of the larger, more profitable models?
- Gross margin. What happened to Apple’s famous profit margins? This was the quarter last year when gross margins peaked at an astonishing 47.4%. More than any other factor it was Apple’s warning last October that margins could drop to as low as 38% that triggered the stock’s precipitous decline. In January, Apple told analysts to expect profit margins this quarter in the 37.5% – $38.5% range. Where they actually fell is critical.
- Revenue and earnings. Is the E in Apple’s PE ratio as bad as Wall Street feared? Last year, Apple reported earnings of $12.30 per share on sales of $39.2 billion. Apple said in January it believes it will beat that top line number by $2 to $4 billion — which would allow it to describe this as its best second quarter on record. On the other hand, the company has tacitly conceded that earnings are going to fall year over year — the first time that’s happened to Apple in a decade. Wall Street has put its bet on earnings of roughly $10 per share. Anything lower or higher could move the stock price.
- Guidance. Enough about the March quarter. For the most part, that’s already baked into the share price. What about June? The guidance Apple gives for the next quarterly report may be the most closely watched data points of all. Investors still don’t know what Apple’s new guidance philosophy really means. Are the ranges Apple gives fixed like goalposts, or are they targets that it might beat? Last year at this time Apple told analysts to expect revenues in June of $32.5 billion. Wall Street took that to mean $37 billion, and when the company delivered $34 billion the stock got crushed. Whether Apple — or Wall Street — has learned its lesson remains to be seen.
- Cash management. Apple has indicated that it is prepared to return more of its massive cash reserves to shareholders, and it’s certain to be asked about those plans during this afternoon’s conference call with analysts. We don’t expect any answers today. Maybe in a few weeks.
Apple usually issues an earnings press release about half an hour after the markets close. It has scheduled a conference call to discuss the results at 5 p.m. EST (2 p.m. PST) — a call that will be streamed live over the Web. We’ll be tuning in, and you can too. Here’s the link: Listen to the Audio Webcast.
By Wednesday morning the fog will have cleared. We’ll have some hard numbers and a sense of how the market will react. Then the rumors and speculation can begin anew.
