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Middle-class Americans to spend $481 a year on Apple products by 2015

post #1 of 38
Thread Starter 
The average middle-class American will spend roughly $481 each year on Apple products by 2015, up from $321 this year, while emerging middle-class consumers in developing markets will drive substantial growth for the company in coming years, according to a new analysis.

In a report sent to clients on Tuesday, Credit Suisse analyst Kulbinder Garcha attributed the $160 increase to affordability and product distribution in America, saying he believes the number of consumers with disposable income levels greater than $30,000 will rise by 10 percent over the next four years to 178 million.

Garcha sees iPhone and iPad sales growth as a critical factor in per-capita spending, estimating Apple's share of the smartphone and tablet markets to rise to 25.6 percent and 93.8 percent, respectively, from 23.5 percent and 88.7 percent over the next 4 years.

The analyst also noted that emerging markets have the potential to bring Apple another $68 billion in sales by 2015, citing an estimated base of 244 million people earning more than $30,000 per year.

"Importantly, by 2015, there will be 244 million consumers in (emerging markets) with similar income profiles, up from 133 million this year," Garcha wrote. "Assuming Apple addresses these markets, this drives an incremental $70 billion in sales by 2015and $17.50 in EPS."

Five countries -- China, India, Brazil, Mexico and Russia, will account for most of the increase, according to the analyst. He noted China as having the most potential for growth, estimated at $28 billion by 2015, as Apple continues to extend its reach in the country.

Emerging countries accounted for $8.2 billion of Apple's revenue in 2010, however, Garcha estimates that number to increase to $24.1 billion in 2011.



A product by product analysis by the firm also indicated that emerging markets could contribute incremental EPS of $18 for Apple by 2015. By expanding the iPhone to the next 50 top carriers in emerging markets, the company could extend its reach to an estimated 1.98 billion mobile subscribers in 2012. Apple's current carrier relationships cover nearly 2.7 billion subscriptions globally, according to the analyst.

Garcha assumes that $400+ smartphones make up 10 percent of the emerging market and customers would adopt a two-year replacement cycle. Given Apple's 57 percent market share in the high-end handset market, that could translate to sales of 54 million additional iPhone units annually,



The analyst projects that iPad growth in emerging markets could add $7.26 in EPS for Apple. He estimates Apple will maintain a 45 percent share of emerging market tablet shipments, which are expected to rise to 126 million units by 2015.

He also pointed out that the firm's estimates may prove conservative, as they don't account for "any further innovation from Apple" or new product launches. For instance, a low-end iPhone, which he says is likely to come in 2012, could add an additional $4.50 to EPS. Credit Suisse projected that Apple could reach total iPhone volumes of 230 million in 2015, though it did note that, without a lower end version, shipments of the device may peak at 135-140 million units per year.

The firm reiterated on Tuesday its Outperform rating and $500 target price for Apple stock.
post #2 of 38
To this day, I marvel at the fact that Jobs (claimed he) would be happy with 1% of the worlds mobile phone market!
post #3 of 38
Quote:
Originally Posted by AppleInsider View Post

The average middle-class American will spend roughly $481 each year on Apple products by 2015, up from $321 this year, while emerging middle-class consumers in developing markets will drive substantial growth for the company in coming years, according to a new analysis.

What that means, then, assuming I'm reading this correctly, is that the biggest threat to Apple's future profitability is the Republican party and their cohorts in the Democratic party, like Barack Obama.
post #4 of 38
Quote:
Originally Posted by anantksundaram View Post

To this day, I marvel at the fact that Jobs (claimed he) would be happy with 1% of the worlds mobile phone market!

Always with the low guidance and followed by the up-side surprise...
Progress is a comfortable disease
--e.e.c.
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Progress is a comfortable disease
--e.e.c.
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post #5 of 38
Quote:
Originally Posted by patrickwalker View Post

What that means, then, assuming I'm reading this correctly, is that the biggest threat to Apple's future profitability is the Republican party and their cohorts in the Democratic party, like Barack Obama.

Whiskey Tango Foxtrot does this mean?
post #6 of 38
Quote:
Originally Posted by ChristophB View Post

Whiskey Tango Foxtrot does this mean?

The GOP (and pathetically weak DINOs like Obama) seem hell-bent on destroying the middle class. If there is no middle class, then there is no Apple market (within the USA). In a lot of nations, the middle class is dependent on the middle class inside the USA. You pull that leg out...
post #7 of 38
Quote:
Originally Posted by ChristophB View Post

Whiskey Tango Foxtrot does this mean?

Politicians are destroying the middle class. The right is doing it openly the left is pretending to be on our side but they are all corporatist pigs.
post #8 of 38
Quote:
Originally Posted by patrickwalker View Post

The GOP (and pathetically weak DINOs like Obama) seem hell-bent on destroying the middle class. If there is no middle class, then there is no Apple market (within the USA). In a lot of nations, the middle class is dependent on the middle class inside the USA.

This to.
post #9 of 38
Quote:
Originally Posted by AbsoluteDesignz View Post

Politicians are destroying the middle class. The right is doing it openly the left is pretending to be on our side but they are all corporatist pigs.

Got it. Corporations are bad unless named Apple. Theft is OK as log as the the majority says so. Property rights be damned.

My two pence - Apple is a corporation that doesn't compromise its principles and its principles are compatible and complimentary to the market place. They don't put profit before principle. Apple will be a success long after the U.S. and the E.U. have slayed themselves. Oh, and politicians reflect the electorate. Hold your locals to task.
post #10 of 38
Quote:
Originally Posted by anantksundaram View Post

To this day, I marvel at the fact that Jobs (claimed he) would be happy with 1% of the worlds mobile phone market!

Wasn't that for 1% in the first year of iPhone sales, not 1% forever?



PS: What's with the asshat jacking the thread with political crap? 2nd fraking post! Jeez
Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"
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Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"
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post #11 of 38
Quote:
Originally Posted by ChristophB View Post

Got it. Corporations are bad unless named Apple. Theft is OK as log as the the majority says so. Property rights be damned.

My two pence - Apple is a corporation that doesn't compromise its principles and its principles are compatible and complimentary to the market place. They don't put profit before principle. Apple will be a success long after the U.S. and the E.U. have slayed themselves. Oh, and politicians reflect the electorate. Hold your locals to task.

I'm pretty sure Apple has it's demons but I'm also sure they are amongst the best of the bunch.

In fact I can't even think of anything Apple has allegedly done bad.

But they are still a corporation and as such technology is all that interests me when it comes to corporations like Apple and Google.
post #12 of 38
What a stupid study/prediction
post #13 of 38
Quote:
Originally Posted by AbsoluteDesignz View Post

I'm pretty sure Apple has it's demons but I'm also sure they are amongst the best of the bunch.

In fact I can't even think of anything Apple has allegedly done bad.

But they are still a corporation and as such technology is all that interests me when it comes to corporations like Apple and Google.

I'll put it like this - when you don't buy what corporations are selling they fade away. When you don't buy what the gov is selling they show up with guns. I'll take the corporation every time. I'm armed better than they are.

Edit: stock holders assume the risk and those demons.

Edit 2: My annual purchases are covering 6 or so non-Apple middle-class.

Edit 3: Google scares me for the reason that they sell their consumer - a principle incompatible with me.
post #14 of 38
Quote:
Originally Posted by patrickwalker View Post

What that means, then, assuming I'm reading this correctly, is that the biggest threat to Apple's future profitability is the Republican party and their cohorts in the Democratic party, like Barack Obama.

Go buy an aluminum foil hat...\
post #15 of 38
Quote:
Originally Posted by lamewing View Post

Go buy an aluminum foil hat...\

Ha! I can totally envision iFixit selling cone shaped aluminum hats crafted from recycled MacBook Pros for next April 1.
post #16 of 38
Quote:
Originally Posted by ChristophB View Post

Oh, and politicians reflect the electorate. Hold your locals to task.

Increasingly not true. Our spineless politicians reflect well heeled interest groups such as the banking sector.
post #17 of 38
Quote:
Originally Posted by paxman View Post

Increasingly not true. Our spineless politicians reflect well heeled interest groups such as the banking sector.

Empowered to be spineless. They get paid by the Party! When the party calls me I tell them to suck it cause I give me property (news flash:money is property) to the individual, not the group. Our politicians are spineless because they are permitted. That happens with a corporation? The only things that save them are buyout for some unrelated value or government grant or loan garranty (gift from taxpayers yet to be BORN!).
post #18 of 38
Quote:
Originally Posted by anantksundaram View Post

To this day, I marvel at the fact that Jobs (claimed he) would be happy with 1% of the worlds mobile phone market!

It's a pretty big world. 1% of 5 billion (the current number of mobile phones in use worldwide) is 50 million. Apple's profit margin on each phone is $380. $380 * 50 million = $1.9 billion profit. Profit, not revenue!

"Apple should pull the plug on the iPhone."

John C. Dvorak, 2007
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"Apple should pull the plug on the iPhone."

John C. Dvorak, 2007
Reply
post #19 of 38
Quote:
Originally Posted by ChristophB View Post

I'll put it like this - when you don't buy what corporations are selling they fade away. When you don't buy what the gov is selling they show up with guns. I'll take the corporation every time. I'm armed better than they are.

Edit: stock holders assume the risk and those demons.

Edit 2: My annual purchases are covering 6 or so non-Apple middle-class.

Edit 3: Google scares me for the reason that they sell their consumer - a principle incompatible with me.

Yea we aren't Google's customers, we are their products.

But as scary as that sounds what does that really mean?
post #20 of 38
Quote:
Originally Posted by AppleInsider View Post

Garcha sees iPhone and iPad sales growth as a critical factor in per-capita spending, estimating Apple's share of the smartphone and tablet markets to rise to 25.6 percent and 93.8 percent, respectively, from 23.5 percent and 88.7 percent over the next 4 years.

Does the prediction for iPad market share four years form now seem ridiculously optimistic to anyone else here???
post #21 of 38
Quote:
Originally Posted by AbsoluteDesignz View Post

Yea we aren't Google's customers, we are their products.

But as scary as that sounds what does that really mean?

For me - I dont give up my liberty or sense of the individual for convenience. As long as I think Apple agrees with that principle, I'll buy their products.
post #22 of 38
Quote:
Originally Posted by paxman View Post

Increasingly not true. Our spineless politicians reflect well heeled interest groups such as the banking sector.

Unless you are aware of extremely widespread vote fraud, it is still the will of the people. If the people are weak and easily influenced, then it is still their will, or lack of it.

Interesting study, kind of meaningless, but even so, the number is higher than I would have expected.
post #23 of 38
Quote:
Originally Posted by jman2u View Post

Does the prediction for iPad market share four years form now seem ridiculously optimistic to anyone else here???

Maybe? No one else has shown any life in the tablet space at all...
post #24 of 38
Quote:
Originally Posted by jman2u View Post

Does the prediction for iPad market share four years form now seem ridiculously optimistic to anyone else here???

Not at all. In fact I believe that iPad markets share already exceeds 90% if you just consider tablets actually purchased by consumers.

Please update the AppleInsider app to function in landscape mode.

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Please update the AppleInsider app to function in landscape mode.

Reply
post #25 of 38
Quote:
Originally Posted by anantksundaram View Post

To this day, I marvel at the fact that Jobs (claimed he) would be happy with 1% of the worlds mobile phone market!

Apple still have less then 10% of the world mobile phone market.

Nokia some years made over 1 billion phones.
Apples record is 30-40 million iPhone's in a year.

The difference is that iPhone ASP is 630 and Nokia is less then 100.

It is more fun to have 30% profit on 630 then 30% profit of a sub 100 phone.
post #26 of 38
Quote:
Originally Posted by shompa View Post

Apple still have less then 10% of the world mobile phone market.

Nokia some years made over 1 billion phones.
Apples record is 30-40 million iPhone's in a year.

The difference is that iPhone ASP is 630 and Nokia is less then 100.

It is more fun to have 30% profit on 630 then 30% profit of a sub 100 phone.

Right now Nokia can only dream of 30% margins
post #27 of 38
Quote:
Originally Posted by jman2u View Post

Does the prediction for iPad market share four years form now seem ridiculously optimistic to anyone else here???

No.

Actually: iPads and Phones will kill the traditional PC market.
Phones/Tablets today is fast enough for 90%+ of the consumers.

What will happen is that traditional PCs will be a margin market. People will use their phone as a computer. Just plug your iPhone to your LCD screen + bluetooth keyboard/mouse and you have a complete computer setup.

There is a niche market for PC like gaming and benchmarks geeks. But for the mainstream ARM is fast enough.

Next year we will see 28nm quod core ARMs from Apple. (in fact, Apple will be first with 28nm ARMs). They are as fast as quod core Intel Core architecture about 2.5ghz. Yes, ARM is as fast as 4-5 year old high end Intel. But that is enough.

ARM SoC 25 dollar. 2.5 watt.
Intel/AMD: Motherboard + CPU/APU. 30-160 watt. 150-1000 dollar.
post #28 of 38
Quote:
Originally Posted by jman2u View Post

Does the prediction for iPad market share four years form now seem ridiculously optimistic to anyone else here???

normally? yea...but being that iPads pretty much ARE the market and they improve at a pace in terms of quality hardware and software that their competitors can't compete with I can't see them losing the market at any point.

Android fans not being as one company oriented as Apple fans will likely get an iPad over the Android offerings (no matter how good they may be in the future) due to the fact that the ecosystem for iPads is so much more complete. Also with iPads permeating the business and educational sectors it won't make sense to go elsewhere.
post #29 of 38
Quote:
Originally Posted by shompa View Post

No.


What will happen is that traditional PCs will be a margin market. People will use their phone as a computer. Just plug your iPhone to your LCD screen + bluetooth keyboard/mouse and you have a complete computer setup.

yea that's definitely the future.

I personally can't wait.

external HDD + LCD + Keyboard + mouse + dock for phone.

The new PC.
post #30 of 38
Quote:
Originally Posted by ChristophB View Post

Whiskey Tango Foxtrot does this mean?

Now that's pretty funny. Thanks.
post #31 of 38
Quote:
Originally Posted by AppleInsider View Post

The average middle-class American will spend roughly $481 each year on Apple products by 2015, up from $321 this year,

So the average family is middle class, and has 2.5 kids. 4.5 x 321 = ~1450

I am quite skeptical. I don't believe that most families spend just under $1500 on Apple products per year. In fact, I don't think that they spend that much on CE in general.
post #32 of 38
Quote:
Originally Posted by jman2u View Post

Does the prediction for iPad market share four years form now seem ridiculously optimistic to anyone else here???

Yes. Fatuous even.
post #33 of 38
Quote:
Originally Posted by Suddenly Newton View Post

It's a pretty big world. 1% of 5 billion (the current number of mobile phones in use worldwide) is 50 million. Apple's profit margin on each phone is $380. $380 * 50 million = $1.9 billion profit. Profit, not revenue!

1) $380*50M is $19B, not $1.9B.

2) Apple does not have anything close to $380 in 'profit margin' per phone (you may be confusing 'gross' margin with 'profit' margin).

3) My guess is that the profit margin is closer to 20% - 25% on each handset.

4) That is still a hugely impressive total profit, however.
post #34 of 38
Quote:
Originally Posted by AbsoluteDesignz View Post

Politicians are destroying the middle class. The right is doing it openly the left is pretending to be on our side but they are all corporatist pigs.

Another way of putting this is Republicans are looking to move the middle class to a higher tax bracket. The Democrats are looking to move the middle class to a lower tax bracket.

Which is why we need a single tax bracket (a flat rate for everyone).
post #35 of 38
Quote:
Originally Posted by AbsoluteDesignz View Post

yea that's definitely the future.

I personally can't wait.

external HDD + LCD + Keyboard + mouse + dock for phone.

The new PC.

Looks like you want a Motorola Bionic. Has all that, with maybe the exception of the external HDD. Not sure if the laptop doc has USB ports on it or not.
post #36 of 38
deleted
post #37 of 38
Quote:
Originally Posted by Wovel View Post

Unless you are aware of extremely widespread vote fraud, it is still the will of the people. If the people are weak and easily influenced, then it is still their will, or lack of it.

Interesting study, kind of meaningless, but even so, the number is higher than I would have expected.

I called the politician spineless, not the people. The will of the people matters little if no politician (party) is willing to regulate corporations / interest groups / industry sectors. Most of these will act in blinkered self interest and are completely unable to self regulate and this is where the true role of politics steps in. The same people control the banking sector now as for the three or four previous administrations in the US. The banking sector remains more or less unregulated to the detriment of 'normal' people.
post #38 of 38
Quote:
Originally Posted by Freshmaker View Post

Looks like you want a Motorola Bionic. Has all that, with maybe the exception of the external HDD. Not sure if the laptop doc has USB ports on it or not.

Nah the tech isn't there yet. Maybe in five years. As much of an android fan as I am I'd rather a windows or os x/iOS offering considering android has no desktop formula as of yet (though 3.0+ could be seen as a step in the right direction.)
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