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JP Morgan significantly increases March quarter iPhone, iPad estimates

post #1 of 11
Thread Starter 
Investment bank J.P. Morgan has made "significant increases" to both its iPhone and iPad projections for the first quarter of calendar 2012 after research indicated "major upside potential" to Apple's sales numbers.

Analyst Mark Moskowitz raised his December 2012 price target for Apple from $625 to $715 in a note to investors obtained by AppleInsider on Tuesday. The firm also raised its unit shipment estimates for the company on "better than expected unit sales activity of the iPhone and iPad."

"We are not trying to inflate expectations ahead of the [March quarter] print. Our intent is to communicate the incremental delta in our new and old estimates as identified by our recent research," he said.

J.P. Morgan had previously expected iPhone shipments to reach 28.1 million in the first quarter of 2012 (Apple's fiscal second quarter), but the company now believes that shipments will reach 31.1 million units. iPhone shipments for the year are now forecast at 138.2 million, up from 128.7 million. Moskowitz believes investors are expecting between 29 and 31 million units.

The analyst believes Apple's 2012 iPhone revamp will arrive in the second half of 2012 and include a "thinner body and LTE capability."

As for the iPad, the firm now estimates shipments of 13.8 million in the March quarter, compared to a prior projection of 10.1 million units. 2012 shipments of iPads are believed to rise to 69.6 million, up from a previous forecast of 59.8 million.




Moskowitz also wrote that he expects Apple to "refresh its MacBook portfolio, including the Air, in the next three months." The firm believes the company needs to improve its portables' specifications and features while introducing lower price points in order to stay ahead of price reductions from the "Ultrabook crowd."

"Plus, we think that Apple needs to sustain its competitive edge on the technology front. Otherwise, it is our view that investors could worry that future Apple product refreshes (i.e., iPhone or iPad) could lose customer appeal," he wrote.

Finally, the analyst pointed to enterprise PCs as "long-term catalyst" for Apple. He expects the "eventual introduction" of Microsoft Office to crack open the enterprise market to Apple's tablet. Enterprise PCs represent 40 percent of global PC units, but enterprise tablets stand at an estimated 10 percent of global tablet units. As such, Moskowitz sees plenty of room for growth as companies take to the iPad.

[ View article on AppleInsider ]
post #2 of 11
Quote:
Originally Posted by AppleInsider View Post

Finally, the analyst pointed to enterprise PCs as "long-term catalyst" for Apple. He expects the "eventual introduction" of Microsoft Office to crack open the enterprise market to Apple's tablet. Enterprise PCs represent 40 percent of global PC units, but enterprise tablets stand at an estimated 10 percent of global tablet units. As such, Moskowitz sees plenty of room for growth as companies take to the iPad.

Sounds like nonsense.
If Office is that important for Apple to crack the enterprise market, why would Microsoft release it on iPad? Better keep it for Windows 8?
post #3 of 11
Quote:
Originally Posted by jason98 View Post

Sounds like nonsense.
If Office is that important for Apple to crack the enterprise market, why would Microsoft release it on iPad? Better keep it for Windows 8?

Well there are pro and cons for MSFT, but ultimately the iPad has become a platform they can no longer ignore, as it represents for us an hope for increasing their revenues ...
post #4 of 11
Quote:
Originally Posted by jason98 View Post

Sounds like nonsense.
If Office is that important for Apple to crack the enterprise market, why would Microsoft release it on iPad? Better keep it for Windows 8?

MSFT makes a lot of money selling MS Office for the Mac. They could do very well making it for the iPad too. Think about this: MSFT only makes money on the future WIN tablets by selling the OS and Office. They likely make more money selling office then the OS. WinMo8 will likely take off very slow (Office on not), If they make Office for the ARM, which they have said they will do, then why not let it be bought by the +100 million iPads that will be on the market by the time Windows 8 finally ships?
"That (the) world is moving so quickly that iOS is already amongst the older mobile operating systems in active development today." — The Verge
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"That (the) world is moving so quickly that iOS is already amongst the older mobile operating systems in active development today." — The Verge
Reply
post #5 of 11
Quote:
Originally Posted by Macky the Macky View Post

MSFT makes a lot of money selling MS Office for the Mac. They could do very well making it for the iPad too. Think about this: MSFT only makes money on the future WIN tablets by selling the OS and Office. They likely make more money selling office then the OS. WinMo8 will likely take off very slow (Office on not), If they make Office for the ARM, which they have said they will do, then why not let it be bought by the +100 million iPads that will be on the market by the time Windows 8 finally ships?

Surely they can make some money on Office for iPad. But letting iPad cruise the enterprise means much smaller market for the future Windows 8 tablets. Do they really want to make it DOA?
post #6 of 11
The Enterprise Consulting industry is a shell of it's former self.

They are banking on the Consumer embedded space to revitalize the Enterprise custom apps marketing via the iPad/iPhone as their gateway interface.
post #7 of 11
Quote:
Originally Posted by mdriftmeyer View Post

They are banking on the Consumer embedded space to revitalize the Enterprise custom apps marketing via the iPad/iPhone as their gateway interface.

The vocabulary is just right. I think you have a strong future as an analyst, young man!

post #8 of 11
JP Morgan lost 1500 souls when his shipping company's ship sank 100 years ago; White Star Line's Titanic.
post #9 of 11
Quote:
Originally Posted by AppleInsider View Post

Investment bank J.P. Morgan has made "significant increases" to both its iPhone and iPad projections for the first quarter of calendar 2012 after research indicated "major upside potential" to Apple's sales numbers.

Analyst Mark Moskowitz raised his December 2012 price target for Apple from $625 to $715 in a note to investors obtained by AppleInsider on Tuesday. The firm also raised its unit shipment estimates for the company on "better than expected unit sales activity of the iPhone and iPad."

"We are not trying to inflate expectations ahead of the [March quarter] print. Our intent is to communicate the incremental delta in our new and old estimates as identified by our recent research," he said.

The analyst doth protest too much.

Quote:
The firm believes the company needs to improve its portables' specifications and features while introducing lower price points in order to stay ahead of price reductions from the "Ultrabook crowd."

The firm doesn't seem to be familiar with the way Apple operates.
post #10 of 11
Quote:
Originally Posted by quinney View Post

. . . The firm doesn't seem to be familiar with the way Apple operates.

Not sure what you mean here but if you mean Apple charges premium prices it does and it doesn't.

The MBA was a new category for Apple and it came in with high prices to cover its development costs. In time the MBA pricing began to drop and it became a price structure the competition could not beat. (Dell produced what looked like a pretty good ultralight to compete with the MBA but with the drop in Apple pricing, Dell pulled its entry from market, losing its shirt in that adventure. I even toyed with the idea of getting a bargain.) If Apple does drop the prices of the MBA further, the ultralights may die before they have a chance to take off. The same has happened with the smaller iPods. The iPhones, I believe, sold by contract, are competitive to others in this artificial market (yet Apple seems to be the only one that walks away with the huge profits per unit).

Before Apple announced the iPad and its price, everyone was calling for an Apple entry price of $1000 and Apple floored them all by halving that prediction for its entry level iPad. Apple was able to do this because it had secure supplies that left the competition wanting yet the price point gave Apple very good returns on its investment. It was both the design and the price that sent the competition running in fear to the University of reThink. It was Apple's pre-purchase of part supplies before their prices could rise in competition that was the final blow to any profits to be made at Apples pricing rates.

The little ATV also surprised the critics. I won't even go into how Apple pricing regarding applications and operating system pricing and apps on the iDevices have plunged to where no one else ever dared.

I would say that these examples certainly show that Apple is more than just innovative in the products and ecosystem and the need for high prices to keep its head above water are history.

When I find time to rewrite the laws of Physics, there'll Finally be some changes made round here!

I am not crazy! Three out of five court appointed psychiatrists said so.

Reply

When I find time to rewrite the laws of Physics, there'll Finally be some changes made round here!

I am not crazy! Three out of five court appointed psychiatrists said so.

Reply
post #11 of 11
Quote:
Originally Posted by mhikl View Post

Not sure what you mean here but if you mean Apple charges premium prices it does and it doesn't.

The MBA was a new category for Apple and it came in with high prices to cover its development costs. In time the MBA pricing began to drop and it became a price structure the competition could not beat. (Dell produced what looked like a pretty good ultralight to compete with the MBA but with the drop in Apple pricing, Dell pulled its entry from market, losing its shirt in that adventure. I even toyed with the idea of getting a bargain.) If Apple does drop the prices of the MBA further, the ultralights may die before they have a chance to take off. The same has happened with the smaller iPods. The iPhones, I believe, sold by contract, are competitive to others in this artificial market (yet Apple seems to be the only one that walks away with the huge profits per unit).

Before Apple announced the iPad and its price, everyone was calling for an Apple entry price of $1000 and Apple floored them all by halving that prediction for its entry level iPad. Apple was able to do this because it had secure supplies that left the competition wanting yet the price point gave Apple very good returns on its investment. It was both the design and the price that sent the competition running in fear to the University of reThink. It was Apple's pre-purchase of part supplies before their prices could rise in competition that was the final blow to any profits to be made at Apples pricing rates.

The little ATV also surprised the critics. I won't even go into how Apple pricing regarding applications and operating system pricing and apps on the iDevices have plunged to where no one else ever dared.

I would say that these examples certainly show that Apple is more than just innovative in the products and ecosystem and the need for high prices to keep its head above water are history.

You make pretty good points, but in none of your cases did Apple reduce the prices in order to outrace its competition to the bottom, which is what I think the analyst was proposing. I think in the present case, Apple will price its MBAs at what it considers the optimum point, and if the "ultrabook crowd" want to try to battle each other to sell the cheapest, lowest margin crap, that will be fine with Apple.
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