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Analyst sees better iPod mix and early Intel Macs

post #1 of 50
Thread Starter 
UBS Investment Research on Tuesday raised its price target on shares of Apple Computer to $86, citing higher than expected video iPod sales and expectations of a rise in Mac sales due to an early release of Intel Macs.

Better iPod mix and early Intel Macs

"We are excited about the prospects for further revenue contribution from iPods due to what we perceive as a positive mix shift to video iPods, which have a higher average selling price (ASP) than either the nano or Shuffle," said analyst Ben Reitzes. "Second, we believe Intel Macs could come as early as Macworld and believe that the initial release could be a broad portfolio of products."

The analyst believes the "iPod Multiplier Effect" is taking shape with strong sales in Macs, retail and peripherals. Additionally, Reitzes said he would not be surprised if Mac sales were buoyed in the future by enhanced digital media capabilities that could catapult Apple to the forefront of the digital home.

Looking ahead to Macworld

UBS believes it is likely Apple will announce new products and content at its January 10, 2006 Macworld with the likely introduction of the first of the Intel- based Macs, which would be much earlier than the companys June guidance.

Reitzes said the Macworld show could turn out to be a "circus" that includes a few new Macs and other introductions such as digital entertainment/media devices, content and services.

"We note that Intel will be introducing its dual-core Yonah processor in January (shipping now to vendors in pre-launch)," said Reitzes. "We believe it is possible for Apple to launch 2-3 new Intel-based Macs by early next year (including even iMacs and PowerBooks)."

The analyst also made reference to recent news reports of an improved Mac mini that may be on the horizon, perhaps as a digital media device.

"We continue to believe that Apple may expand its "digital hub offerings to attempt to become even a bigger part of the digital home with possible new product introductions as early as at Macworld in January that may include "DVR-like" functionalities."

Media hubs, Viiv, Apple-branded phones

Reitzes said Apple could eventually discuss more innovations around media hubs (and related services) that act as storage units for music, movies, photos and/or other types of home entertainment -- pointing out that Intel's soon-to-be introduced "Viiv" could allow the company to explore additional consumer entertainment opportunities within the personal computer.

"We also believe that the company may choose to enter new consumer markets such as Apple branded cell-phones over the next 2 years where the company would be able to leverage its market leading innovations and creative designs that have made the iPod such a tremendous hit with customers," the analyst said.

Raising estimates

Given the above, UBS has raised its estimates on Apple through the 2007 fiscal year (FY). For FY06, the firm raised its earnings-per-share (EPS) estimate to $2.10 from $1.85 based on revenue growth of 42-percent year-over-year to $19.8B. In FY07, UBS expects EPS to come in at $2.58 based on revenue growth of 18-percent to $23.3B.

11.4 million iPods this quarter?

For the current quarter, the firm expects Apple to report EPS of 58 cents based on revenue growth of 50-percent year-over-year to $5.2B including iPod unit growth of 149-percent year-over-year to 11.4 million units (including sales of over 3 million video iPods.)

UBS continues to rate Apple a "Buy", raising its price target from $74 to $86 a share.
post #2 of 50
So Apple lowers their iPod sales estimates to around 8 and these guys increase it to 11.4? What do they know that nobody else does?
post #3 of 50
Quote:
Originally posted by schmidm77
So Apple lowers their iPod sales estimates to around 8 and these guys increase it to 11.4? What do they know that nobody else does?

I think it may be a difference of all iPod models (11.4 million) and iPod nano sales (7.5-8 million). But I might be wrong. I am pretty certain that the 8M number has been only about the nano.
post #4 of 50
Quote:
Originally posted by schmidm77
So Apple lowers their iPod sales estimates to around 8 and these guys increase it to 11.4? What do they know that nobody else does?

Apple's revised estimate was for Nanos only. These guys expect 3 million vPods and 11 million altogether, so it sounds like they and Apple are in the same ballpark.
post #5 of 50
post #6 of 50
Quote:
Originally posted by Towel
Apple's revised estimate was for Nanos only. These guys expect 3 million vPods and 11 million altogether, so it sounds like they and Apple are in the same ballpark.

So what about shuffles then? Wasn't there a report that they are still selling pretty well too?
post #7 of 50
It's limited by manufacturing capacity. You've been reading the problems Apple is having there. Going back to Synaptics for the scrollwheel to supplement their own design.

Just once, it would be nice if Apple could resolve their well known, and long time penchent for grossly underestimating demand.
post #8 of 50
Quote:
Originally posted by melgross
It's limited by manufacturing capacity. You've been reading the problems Apple is having there. Going back to Synaptics for the scrollwheel to supplement their own design.

Just once, it would be nice if Apple could resolve their well known, and long time penchent for grossly underestimating demand.

In fairness to Apple demand prediction is a bit of an art. They are actually getting better. But some things still surprise them. It is also actually better to under produce (within reason) than over produce.
post #9 of 50
"first of the Intel- based Macs, which would be much earlier than the companys June guidance."

Apple's "June guidance," just to be clear, was that Intel Macs would ALREADY be IN THE MARKET... BY June. Many people think Apple said Intel Mac would APPEAR in JUNE. Possible. But it's a latest date, nothing more.

"Macworld show could turn out to be a "circus""

I think Apple will limit MWSF to one or two big announcements, and save others for press events in the coming weeks after MWSF. This makes a bigger impact: multiple stories in the press, week after week. Which ones will be at MWSF and which ones will be later? That might just depend on practical factors like which ones will come off the assembly lines first. Conclusion: don't be too upset if you favorite dream doesn't come true on Jan. 10. It MIGHT just come true in the following month.

"iPod Multiplier Effect"

Hmmm... that beats "iPod Halo Effect," but I'm still lobbying for the term "iPod Gateway Effect."
post #10 of 50
Quote:
Originally posted by Chris Cuilla
In fairness to Apple demand prediction is a bit of an art. They are actually getting better. But some things still surprise them. It is also actually better to under produce (within reason) than over produce.

It is, within reason. But Apple has been notorious for this. As far back as I can remember (and that goes back a while, I can tell you. ), Apple has been criticised for this.

As a matter of fact, It 's been said many times over the years, that apple's problems with this has been so severe that it's cost them marketshare. Marketshare that they were unlikely to get back.
post #11 of 50
At least this analyst speculates on iMacs and PowerBooks, which make sense. Other analysts and rumor sites have tried to pass off iBooks as likely first-MacIntel machines. It makes no sense to replace a sub-$80 part with a above-$200 part and make your entry-level machine faster than your pro machine-- it's silly and just not going to happen.

Unless you use more than 4GB of RAM in your iMac, you're unlikely to miss the 64-bitedness, and the Yonah should be pretty competitive with the G5's in the current iMacs.
post #12 of 50
Quote:
Originally posted by nagromme
"first of the Intel- based Macs, which would be much earlier than the companys June guidance."

Apple's "June guidance," just to be clear, was that Intel Macs would ALREADY be IN THE MARKET... BY June. Many people think Apple said Intel Mac would APPEAR in JUNE. Possible. But it's a latest date, nothing more.

"Macworld show could turn out to be a "circus""

I think Apple will limit MWSF to one or two big announcements, and save others for press events in the coming weeks after MWSF. This makes a bigger impact: multiple stories in the press, week after week. Which ones will be at MWSF and which ones will be later? That might just depend on practical factors like which ones will come off the assembly lines first. Conclusion: don't be too upset if you favorite dream doesn't come true on Jan. 10. It MIGHT just come true in the following month.

"iPod Multiplier Effect"

Hmmm... that beats "iPod Halo Effect," but I'm still lobbying for the term "iPod Gateway Effect."

I don't know. "By June" means only that new Macs would be out "by June". It doesn't mean anything else. It doesn't mean May, or April, or March. All it means is that by the time the Dev Conf, Apple would have machines out.

Of course, that's going by the schedule that Jobs presented us with LAST June. Things change.

Also, I was always suspicious of that schedule. I've had the feeling, and I've said this here before, that we were being snookered. I'm not sure that, no matter how we parse his words, that Apple always intended to get at least some stuff out the doors well in advance.

I felt more sure of that when it came out that 10.4.3 has Rosetta emulating a G4 with Altivec rather than the G3 without it that he has said it would emulate.

Also, that 10.4.4 equalized the two versions for the first time.

But, wouldn't it be a hoot if they came out with nothing?

Oops, I'd better sell my stock now, it just took another leap, and if that happens, it will plummet.
post #13 of 50
Quote:
Originally posted by Booga
At least this analyst speculates on iMacs and PowerBooks, which make sense. Other analysts and rumor sites have tried to pass off iBooks as likely first-MacIntel machines. It makes no sense to replace a sub-$80 part with a above-$200 part and make your entry-level machine faster than your pro machine-- it's silly and just not going to happen.

Unless you use more than 4GB of RAM in your iMac, you're unlikely to miss the 64-bitedness, and the Yonah should be pretty competitive with the G5's in the current iMacs.

Yeah, well, don't forget that Yonah is also 32 bit. And will iMac buyers miss the 64 bitness?
post #14 of 50
Quote:
Originally posted by melgross
I'm not sure that, no matter how we parse his words, that Apple always intended to get at least some stuff out the doors well in advance.

I think that is exactly what nagromme means. By June Xth, 2006 could mean anything up to that date, including well before.

I think Apple probably realizes that they need to make this transition happen sooner rather than later. As they get closer to June, their sales are going to reflect people waiting for new Intel-based Macs. So the sooner the get at least some of the line moved over the less impact this will be. It will also serve notice for any developers who might be dragging their feet.
post #15 of 50
Quote:
Originally posted by melgross
I've had the feeling, and I've said this here before, that we were being snookered. I'm not sure that, no matter how we parse his words, that Apple always intended to get at least some stuff out the doors well in advance.

Under promise, over deliver!

Also, predicting a complex hardware/software launch, involving many partners, a year ahead, is not a precise science. I'm sure Apple didn't KNOW the real final unveiling date, back at WWDC. So their timeframe was bound to be stated conservatively. It was bound to be a "worst case."
post #16 of 50
Quote:
Originally posted by nagromme
Under promise, over deliver!

Also, predicting a complex hardware/software launch, involving many partners, a year ahead, is not a precise science. I'm sure Apple didn't KNOW the real final unveiling date, back at WWDC. So their timeframe was bound to be stated conservatively. It was bound to be a "worst case."

The thing is, they may have known EXACTLY what that date was going to be. They just didn't want anyone to know because of that so called Osbourn Effect.

Get people to buy up to the last minute before the introduction.

The only thing that bothers me, and it could be part of the deception, if indeed products will be coming out in January, that we are not seeing the normal drying up of supplies in the dealer channels being reported.
post #17 of 50
Quote:
Originally posted by melgross
The thing is, they may have known EXACTLY what that date was going to be. They just didn't want anyone to know because of that so called Osbourn Effect.

While there may be some truth to this reasoning. It is also important to note that Sometimes What Everyone Remembers Is Wrong.

Quote:
Originally posted by melgross
we are not seeing the normal drying up of supplies in the dealer channels being reported.

Could still be a little bit early for that.
post #18 of 50
Quote:
Originally posted by melgross
The only thing that bothers me, and it could be part of the deception, if indeed products will be coming out in January, that we are not seeing the normal drying up of supplies in the dealer channels being reported.

It could also be part of the plan. Given the magtnitude of this change, it wouldn't surprise me if Apple sold PPC and Intel Macs side-by-side for a while. Especially PB's, since there will surely be pro folks who need new machines but don't want to rush into bleeding-edge x86 issues.
post #19 of 50
Quote:
Originally posted by Chris Cuilla
While there may be some truth to this reasoning. It is also important to note that Sometimes What Everyone Remembers Is Wrong.



Could still be a little bit early for that.

Yes, I know. But I was there at the time, and Cringely is inncorrect as well. He wasn't there at the time. The Osbourn 2 was very competitive with the Kaypro. Or would have been, if it came out.

The Kaypro's were praised at the time, but were nothing special as far as advances went. The problems Osbourn had went beyond the announcement of a not shipping product. But the idea is valid.

Anyway, I did say "so called".
post #20 of 50
Quote:
Quote:
Originally posted by booga
Unless you use more than 4GB of RAM in your iMac, you're unlikely to miss the 64-bitedness, and the Yonah should be pretty competitive with the G5's in the current iMacs.

Originally posted by melgross
Yeah, well, don't forget that Yonah is also 32 bit. And will iMac buyers miss the 64 bitness?

I think I made that point. No, no one will miss the 64-bittedness unless they had more than 4GB of RAM in their iMac. I suspect the number of people for whom that is true is zero. Other than that it's pretty much just bragging rights. Although on the Intel side there are several code optimizations that x86-64 (EM64T) allows, performance is performance, and Yonah has it.
post #21 of 50
Quote:
Originally posted by Booga
Originally posted by melgross
Yeah, well, don't forget that Yonah is also 32 bit. And will iMac buyers miss the 64 bitness?



I think I made that point. No, no one will miss the 64-bittedness unless they had more than 4GB of RAM in their iMac. I suspect the number of people for whom that is true is zero. Other than that it's pretty much just bragging rights. Although on the Intel side there are several code optimizations that x86-64 (EM64T) allows, performance is performance, and Yonah has it.
[/QUOTE]

You're right. I read it wrong.

Somehow, I had you saying iBOOK in that last sentence.
post #22 of 50
Quote:
Originally posted by Towel
IGiven the magtnitude of this change, it wouldn't surprise me if Apple sold PPC and Intel Macs side-by-side for a while. Especially PB's, since there will surely be pro folks who need new machines but don't want to rush into bleeding-edge x86 issues.

Absolutely. I would be shocked if Apple didn't sell BOTH the old and the new. Giving a choice would really help a lot of people through this transition. It lets the transition happen when YOU want it

Apple and Steve Jobs have "kept selling the old generation on the side" several times in recent years. Now is a great time to do it again.

Or another interesting possibility: reverse the emphasis. Sell an "early adopter" Intel model or two, alongside the "main" PowerPC PowerBooks.

Either way, I get my Intel PowerBook sooner, and people who depend on certain PowerPC apps have something to buy too.
post #23 of 50
Quote:
The thing is, they may have known EXACTLY what that date was going to be. They just didn't want anyone to know because of that so called Osbourn Effect.

Sharon!!!!!!!!!!!!!!!!!!!! ugh I ugh I ugh ugh bb bring my my Pod thi thing i want to hook it up to the new intel mac and Listen to bl bl aaack sabbath in my underwear.

LOL sorry I couldnt resist
post #24 of 50
That mock up Zunx posted is cool.

Its a mix between the G4 Cube and iPod mini.

Would be good for Apple to have some type of small tower.

The G4 Cube design was great.
post #25 of 50
I've been reading about Rob Glaser CEO of Real complaining about Apple not opening Fairplay.

What I found interesting is over the past couple of years Real has been complaining about the iPod their music service didn't even work on the Mac.

The other part is the fact that if Microsoft or Real had invented the iPod they would not likely enable it to run on the Mac either.

Two points that counter Glaser's complaint. Is the fact you can play several music formats on the iPod. You really don't have to buy any music from iTunes at all.

The second is that Apple developed iPod and iTunes and are completely free to choose who they share it with or not share it at all.

The fact that no one else's DRM can play on the iPod is not anticompetative or wrong in any way.

Any company is free to come up with their own iPod + iTunes like service.
post #26 of 50
Quote:
[i]

Oops, I'd better sell my stock now, it just took another leap, and if that happens, it will plummet. [/B]


Yeah the stock is so hyper inflated right now that I am really getting concerned about what it will do if there is any perceived "bad" news.

Some analysts have set their target price at $79 and we now see $86, but what happens if the iPod numbers are just a little lower than people expect?

Thud.

When is the next quarterly report?
post #27 of 50
Quote:
Originally posted by WelshDog
When is the next quarterly report?

Mid-Jan, i.e. pretty much a week after MWSF, IIRC.
post #28 of 50
Quote:
Originally posted by melgross
Yeah, well, don't forget that Yonah is also 32 bit. And will iMac buyers miss the 64 bitness?

Sure I will miss it. It is a bragging right with my neighbor that has a dual core intel 64 bit dell.

If dual core yonahs will render and run FC Studio faster, I don't care if they were 8 bit processors.

Hard-Core.
Reply
Hard-Core.
Reply
post #29 of 50
Given everything that we are hearing, I wonder whether the first generation x86 Macs will be limited to non-PowerMac and to portables. The reason I say this is because the current high end PPC chips are filling in well the needs of the "extreme power users". What the PPC is failing to get right at the moment is performance with a lower power consumption, something that is critical for portable computers.

I am not sure that it would be wise to move the whole line in one go, since it is a lot to manage and that the new x86 chip doesn't yet provide what is needed for the high end systems. I wouldn't be surprised if we had to wait four months for the x86 PowerMacs.
post #30 of 50
Quote:
Originally posted by ajmas
I wouldn't be surprised if we had to wait four months for the x86 PowerMacs.

Four months? I think there's a consensus that the PowerMac isn't likely to switch for a year or more. Like you said, the G5 is still a kick-ass chip, and the serious M-derived desktop chips (Conroe?) aren't due for a while yet. Apple may surprise, but until the Intel option can toast a four-way G5, I would expect them to leave the PowerMac on PPC.
post #31 of 50
Quote:
Originally posted by Towel
Four months? I think there's a consensus that the PowerMac isn't likely to switch for a year or more. Like you said, the G5 is still a kick-ass chip, and the serious M-derived desktop chips (Conroe?) aren't due for a while yet. Apple may surprise, but until the Intel option can toast a four-way G5, I would expect them to leave the PowerMac on PPC.

Actually I think I was being a little conservative and that a time scale greater than four months would be more realistic. What will be interesting is to see how the market, and the stock market, reacts to a line of computers that has two types of chips.
post #32 of 50
Quote:
Originally posted by ajmas
Actually I think I was being a little conservative and that a time scale greater than four months would be more realistic. What will be interesting is to see how the market, and the stock market, reacts to a line of computers that has two types of chips.

The only machines that Apple would have a problem changing over until close to 2007 is the PM and XServes.

The rest can go. There will be plenty of criticsm if the iMacs go 32 bit (sorry Booga and aplnub). But there has been a lot of chatter at this time that OS X x86 only supports IA-32. The statements haven't been pleasant to read.
post #33 of 50
Originally posted by aplnub
Sure I will miss it. It is a bragging right with my neighbor that has a dual core intel 64 bit dell.

If dual core yonahs will render and run FC Studio faster, I don't care if they were 8 bit processors.




actually, 8bit would be ultracool in a retro kinda way. particularly for electronic music people
post #34 of 50
Originally posted by melgross
The only machines that Apple would have a problem changing over until close to 2007 is the PM and XServes.

The rest can go. There will be plenty of criticsm if the iMacs go 32 bit (sorry Booga and aplnub). But there has been a lot of chatter at this time that OS X x86 only supports IA-32. The statements haven't been pleasant to read.



heh. winxp 64bit is like, whatever. no loss if there is no 64bit macintels for the whole of 2006. sse2 and sse3 can do a lot of the heavy lifting the so-called "hardcore" pc jocks will laugh but they're all running winxp32bit anyway because games run better on xp 32bit native rather than via windows-on-windows emulation for xp 64bit.

ps. mel i got your PM, i sent you that PM months ago!! in the user controlpanel for appleinsider forums you can always see if your inbox has PMs (but i always get an email when i have a PM)
post #35 of 50
Quote:
Originally posted by sunilraman
Originally posted by melgross
The only machines that Apple would have a problem changing over until close to 2007 is the PM and XServes.

The rest can go. There will be plenty of criticsm if the iMacs go 32 bit (sorry Booga and aplnub). But there has been a lot of chatter at this time that OS X x86 only supports IA-32. The statements haven't been pleasant to read.



heh. winxp 64bit is like, whatever. no loss if there is no 64bit macintels for the whole of 2006. sse2 and sse3 can do a lot of the heavy lifting the so-called "hardcore" pc jocks will laugh but they're all running winxp32bit anyway because games run better on xp 32bit native rather than via windows-on-windows emulation for xp 64bit.

ps. mel i got your PM, i sent you that PM months ago!! in the user controlpanel for appleinsider forums you can always see if your inbox has PMs (but i always get an email when i have a PM)

Yeah, I don't care that much either. But there are a lot of people, even on these boards who have expressed actual *anger* over the fact that Apple won't be 64 bit right out of the box. I try to explain that Apple has been working on this OS for years as a 32 bit OS - there was no 64 bit Win OS out either for almost all of this time.

I think that Leopard will be a 64 bit Mactel OS, and the PM and XServe will wait for that, at least. Then everything else can also go 64 bit as Merom will be out. But as there won't be a single core Merom, we might not see the iBook use it for some time. Possibly the same for the Mini, unless Apple has other plans for it where it needs the power, such as a media hub decoding H 264 and such.

And no, I never get an e-mail when I get a message. It's a flaw in the software they use here. There should be some indicator when we are here in the forum that there is a message. A blinking spot or something. I don't like to seem impolite by not responding to a message. I sent messages to some others that were never read. Maybe they didn't want to read them because it was from me , or they didn't know they got them.

I click on the pm spot in my own post window to see my messages, but I often don't think to check.
post #36 of 50
The bigger test for OS X x86 will not be the "bitness" of the OS but rather how many 3rd party applications are ready for the launch and what word about the conversion of Adobe's and Microsofts applications are going, hopefully with an expected timeline for when they will be ready for the Intel Macs. If there are a good number of titles from developers ready with a focus on the market sector that Apple releases hardware in first then the transition will go relatively smooth (as long as there are no major hardware problems). Then if there is a timeline for the transition of other major software, notibly Adobe's creative suite and Microsoft Office, then the rest of the transition will go well since there will have been a 6-18 month shakedown for the basic hardware/OS in the real world to work out any major problems.
post #37 of 50
Quote:
Originally posted by JCG
The bigger test for OS X x86 will not be the "bitness" of the OS but rather how many 3rd party applications are ready for the launch and what word about the conversion of Adobe's and Microsofts applications are going, hopefully with an expected timeline for when they will be ready for the Intel Macs. If there are a good number of titles from developers ready with a focus on the market sector that Apple releases hardware in first then the transition will go relatively smooth (as long as there are no major hardware problems). Then if there is a timeline for the transition of other major software, notibly Adobe's creative suite and Microsoft Office, then the rest of the transition will go well since there will have been a 6-18 month shakedown for the basic hardware/OS in the real world to work out any major problems.

You're right. But we're not talking about something that makes sense, we're talking about some people's reaction to it.
post #38 of 50
I don't think any G5 Mac will switch until there is a corresponding intel chip.

I think its more likely the iMac will have dualcore PowerPC and not go intel 32 bit.

PC fanatics would have a field day if iMac's stepped back to 32 bit.
post #39 of 50
Quote:
Originally posted by TenoBell
I don't think any G5 Mac will switch until there is a corresponding intel chip.

I think its more likely the iMac will have dualcore PowerPC and not go intel 32 bit.

PC fanatics would have a field day if iMac's stepped back to 32 bit.

That's what I'm saying as well. Of course, with Steve in charge.
post #40 of 50
hmmm... i'm thinking the iMac will go overclocked-dualcore-yonah within the first 5 months of 2006. (overclocked because of the headroom for heat given the dualcore yonah powerdraw of only 65W or something like that...) of course, total conjecture (but interesting, no?) on my part...
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