Supply chain suggests Apple to see better-than-expected holiday season, analyst says
A positive earnings pre-announcement from Apple supplier Dialog Semiconductor on Wednesday leads RBC Capital Markets analyst Amit Daryanani to believe iPhone sales are set to outperform Wall Street expectations in the December quarter.
In a note to investors obtained by AppleInsider, Daryanani notes Dialog pre-announced positive September quarter results on the back of mobile systems revenue, suggesting strong component orders from Apple. Dialog raised revenue expectations for the past quarter to about $345 million, up 13 percent from previous estimates between $290 million to $320 million.
Though Dialog failed to delve into specifics, it did say the revenue bump is in part the result of mobile systems orders being pulled forward into the third quarter to accommodate China's National Day holiday on Oct. 1. Apple, which accounts for 75 to 80 percent of Dialog's mobile systems revenue, traditionally builds iPhone approximately 60 days out, meaning the pulled-in orders are likely related to the December quarter, Daryanani writes.
Along with Dialog earnings, the analyst believes a number of associated metrics point to strong year end earnings for Apple. In particular, Darynani cites an upside to iPhone ASPs on better than expected preliminary carrier data points, a shift in consumer preference to Apple's flagship iPhone 7 and 7 Plus models, mix-shift toward the larger 5.5-inch model, the Samsung Galaxy Note 7 debacle and an extra week tacked on to the December quarter.
In a recent RBC survey 46 percent of respondents said they plan to buy a 5.5-inch iPhone, up from 38 percent a year ago. Further, more than half of consumers intend to spring for the mid-tier 128GB version. Daryanani said there was fear that users would stick with 32GB of storage, formerly Apple's mid-tier choice which this year becomes the lowest capacity option. Apple makes premium on devices with higher memory allotments. RBC's survey also suggests consumers are replacing iPhones at a steady rate.
Finally, about 17 percent of consumers polled intend to purchase an Apple Watch compared to 13 percent last year, while Apple Pay is making strides with usage rates hovering at 24 percent, up from 16 percent just after launch.
Daryanani sets an Apple stock target price of $125 and estimates the company will take in $47.3 billion in revenue for the September quarter on 44.2 million iPhone unit sales. For the important holiday quarter, the analyst sees $78.7B in revenue on about 79 million iPhone sales.
In a note to investors obtained by AppleInsider, Daryanani notes Dialog pre-announced positive September quarter results on the back of mobile systems revenue, suggesting strong component orders from Apple. Dialog raised revenue expectations for the past quarter to about $345 million, up 13 percent from previous estimates between $290 million to $320 million.
Though Dialog failed to delve into specifics, it did say the revenue bump is in part the result of mobile systems orders being pulled forward into the third quarter to accommodate China's National Day holiday on Oct. 1. Apple, which accounts for 75 to 80 percent of Dialog's mobile systems revenue, traditionally builds iPhone approximately 60 days out, meaning the pulled-in orders are likely related to the December quarter, Daryanani writes.
Along with Dialog earnings, the analyst believes a number of associated metrics point to strong year end earnings for Apple. In particular, Darynani cites an upside to iPhone ASPs on better than expected preliminary carrier data points, a shift in consumer preference to Apple's flagship iPhone 7 and 7 Plus models, mix-shift toward the larger 5.5-inch model, the Samsung Galaxy Note 7 debacle and an extra week tacked on to the December quarter.
In a recent RBC survey 46 percent of respondents said they plan to buy a 5.5-inch iPhone, up from 38 percent a year ago. Further, more than half of consumers intend to spring for the mid-tier 128GB version. Daryanani said there was fear that users would stick with 32GB of storage, formerly Apple's mid-tier choice which this year becomes the lowest capacity option. Apple makes premium on devices with higher memory allotments. RBC's survey also suggests consumers are replacing iPhones at a steady rate.
Finally, about 17 percent of consumers polled intend to purchase an Apple Watch compared to 13 percent last year, while Apple Pay is making strides with usage rates hovering at 24 percent, up from 16 percent just after launch.
Daryanani sets an Apple stock target price of $125 and estimates the company will take in $47.3 billion in revenue for the September quarter on 44.2 million iPhone unit sales. For the important holiday quarter, the analyst sees $78.7B in revenue on about 79 million iPhone sales.
Comments
Good point. I certainly wasn't saying AI shouldn't report on them. Just that it would be good to have additional context if available from Apple. I am also surprised at how accurate Apple's guidance has been and have no idea how they achieve it.
Halo and all that stuff (iMac, iPad, a couple of iPhones - skipped the 5 series, iPad Pro)
All the apps work alike on iPhone and Android.
Some seem to work better on Android (better integration of functions - Apple is still closing some stuff - yes, I know, you'll say with good reason, we've been there before).
I guess, I realized that it's been a couple of years that there's nothing special to a smartphone.
Let's see how I can sync my calendar and contacts. I'll be just fine... paying 600USD less
Recent reports would seem to indicate you are a small minority.
Prices can be changed of course, and generally they have been within a couple of months of release. I still wouldn't consider one for myself as it's not likely to fall below $500 anyway IMO, Instead I'm picking up a sub-$400 but just as well-equipped and featured spare smartphone for off-work personal use.
Hmm.. an Apple fan that's a feature whore (13MP camera, Snapdragon quad core, 2Gb RAM) and skimpy. It's surprising you stayed with Apple this long.
Might as well go all the way and get a Windows machine, some random tablet, Some random smart watch and a surface. Good luck.
When hard-core Apple haters are disappointed and saying they're switching to iPhone then you know it was a disaster. Dropping the price will be another disaster, I predict they'll drop about $200 a few weeks after release. Fire phone all over again.
kind of had it with all the pressure that a smartphone is building.
it's then that I caught this one and found the specs quite interesting considering the price.
Still have to make sure that they all deliver.
first thing I can say is that speed is not an issue (I'm not a gamer)
It's fully unlocked.
Some carriers do propose lock-ins