Even though Apple has silenced critics and beaten existential crises before, some fans of its minimalist products and investors in its maximalist stock are nervous.

Apple is set to report its second quarter earnings on Thursday after the bell. The numbers come at a time the company continues to grapple with growth challenges due in part to a sales slowdown in China and a customer base seemingly less interested in upgrading to its latest iPhone lineup.

Analysts are expecting low sales figures for the quarter ending March 31 – despite the company beating expectations in the last four quarters.

This will be its first earnings report since the launch of its biggest new product in years, its $3,499 mixed reality Vision Pro headset. Apple spent about $100 billion in research and development on the device, according to a recent analysis.

The headset launched just as the extended reality (XR) market — a category that includes augmented, virtual and mixed reality — has plateaued with little mainstream consumer adoption. The Vision Pro had limited apps out of the gate but its experience is unmatched when it comes to watching immersive videos and interacting with the world around you, with buy-ins already from Hollywood studios and game developers.

Still, it’s an expensive computer you wear on your face.

Most recently, Apple analyst Ming-Chi Kuo posted an updated forecast for the headset, stating production was being cut by several hundred thousand units.

Although it’s unlikely Apple will reveal a specific number of headsets sold in the latest quarter, it may give a general update about how it’s performing.

Problems in China

In particular, the company has lost momentum in China as nationalism, a rough economy and increased competition have hurt Apple over the past several months. Market research firm IDC said Apple’s smartphone shipments tumbled a stunning 10% globally in the first quarter of this year.

Chinese manufacturers, including Huawei and Xiaomi, have also made notable gains as consumers who once would have considered Apple are now turning to national brands in China.

“It’s a steep drop for Apple, but if you think of where we have been in the past four years, Apple has probably been the most resilient brand, overcoming supply chain issues and macro challenges, more than other brands,” said Nabila Popal, research director at IDC, told CNN at the time.

Samsung also had been the top smartphone manufacturer for the past 12 years. Although Apple took the crown last year, its time on top lasted only one quarter. Samsung has since reclaimed its position, IDC reported.

The company’s stock price has slumped more than 8% in 2024 to less than $170 a share after reaching nearly $200 per share at different points in the past year. The company has overcome hurdles and threats many times before to reach a market capitalization of $2.6 trillion, making it one of the largest and most powerful companies in the world.

All eyes on AI

According to David McQueen, research director at tech intelligence firm ABI Research, the company could spark sales growth soon.

“It [may] engender a ‘super cycle’ as it rolls out generative AI features in its upcoming products, despite being “a little late to the generative AI party,” he told CNN.

Apple has not yet sent a strong message about artificial intelligence at a time when many tech companies are doubling down on related strategies and features. But rumors indicate the company will introduce new AI-powered tools at its annual Worldwide Developers Conference in June.

The company is also reportedly in talks with ChatGPT-maker OpenAI to power an iPhone chatbot.

Apple is holding a press event next week where it’s largely expected to introduce updates to its iPad lineup and related accessories. It’s unclear if its next-generation iPadOS software, also set to be unveiled in June, will include AI-powered tools, too.