iPhone 5 order cuts dismissed as 'not news,' simply 'noise'
Wall Street analysts are dismissing recent concerns over iPhone build plans, with one market watcher saying the order cuts could instead be a sign that Apple seeing improved component yields and product margins.
Apple stock took a hit on Friday after reports surfaced claiming that the company had made significant cuts to iPhone 5 orders. Mark Moskowitz of J.P. Morgan responded on Monday and said the reports are just "more noise" that will fuel an investor overreaction.
Instead, Moskowitz believes the order cuts could mean that iPhone 5 manufacturing yields ? and thus, gross margins for the product ? are improving.
"In our view, the potential order cuts are a direct result of manufacturing yields improving following the fast-and-furious product roll-outs of the iPhone 5 as well as new iPads and Macs," he said.
If product component yields are in fact improving, Apple could instead be pulling back on what Moskowitz said would be "excess orders" of certain components. At launch, the iPhone 5 was plagued with a number of production issues that are believed to have cut into Apple's margins and limited supply of the company's latest handset.
Maynard Um, senior analyst with Wells Fargo, also said on Monday that he's not fazed by the rumored iPhone 5 cuts, which were publicized by The Wall Street Journal. Any such cuts, if true, are "not news," he said.
One report from Japan's Nikkei claimed that Apple had initially planned to order about 65 million screens in the March quarter before trimming those plans. But Um believes that number is "unrealistic," and may be inaccurate.
"The likelihood that Apple would have shipped 65 million iPhone 5s for the March quarter would have been minuscule, in our opinion," he said.
Um has forecast for Apple to sell 43 million iPhones in the March quarter, a number he still believes is "achievable" in light of the latest rumors.
Apple stock took a hit on Friday after reports surfaced claiming that the company had made significant cuts to iPhone 5 orders. Mark Moskowitz of J.P. Morgan responded on Monday and said the reports are just "more noise" that will fuel an investor overreaction.
Instead, Moskowitz believes the order cuts could mean that iPhone 5 manufacturing yields ? and thus, gross margins for the product ? are improving.
"In our view, the potential order cuts are a direct result of manufacturing yields improving following the fast-and-furious product roll-outs of the iPhone 5 as well as new iPads and Macs," he said.
If product component yields are in fact improving, Apple could instead be pulling back on what Moskowitz said would be "excess orders" of certain components. At launch, the iPhone 5 was plagued with a number of production issues that are believed to have cut into Apple's margins and limited supply of the company's latest handset.
Maynard Um, senior analyst with Wells Fargo, also said on Monday that he's not fazed by the rumored iPhone 5 cuts, which were publicized by The Wall Street Journal. Any such cuts, if true, are "not news," he said.
One report from Japan's Nikkei claimed that Apple had initially planned to order about 65 million screens in the March quarter before trimming those plans. But Um believes that number is "unrealistic," and may be inaccurate.
"The likelihood that Apple would have shipped 65 million iPhone 5s for the March quarter would have been minuscule, in our opinion," he said.
Um has forecast for Apple to sell 43 million iPhones in the March quarter, a number he still believes is "achievable" in light of the latest rumors.
Comments
"Wall Street Journal to continue being a trusted news source, despite lying through their teeth."
"The worldwide manhunt for common sense continues; three dollar reward not seen as very enticing."
Yeah, there sure aren't any people who short Apple stock; it's all legitimate trades, representing the real value of the company at any one time¡
Quote:
Originally Posted by Tallest Skil
"Wall Street Journal to continue being a trusted news source, despite lying through their teeth."
"The worldwide manhunt for common sense continues; three dollar reward not seen as very enticing."
Yeah, there sure aren't any people who short Apple stock; it's all legitimate trades, representing the real value of the company at any one time¡
It's ironic they got as much press for this report after just reporting blatant lies and false assumptions about a $99 iPhone.
not sure I agree with the component yield reasoning. If Apple need 1m panels they order 1m panels. They don't order 2m in the hope that they get 1m working ones. Yield is the problem of the OEM.
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The media and analysts create false problem, the media and analysts destroy false problem... Meanwhile, who benefits? The media and analysts...
The stock drop in Apple over the last few months is a market correction nothing more, nothing less....
It grew a little too fast and will now start growing at a more realistic rate once the panic subsides....
Wow I'm really learning a lot reading the news about Apple lately lol.
AT$T sold a record number of iPhone, but they didn't sell **** because Samsung sold way more.
Apple's Mac sales declined and they grew by 5% last quarter.
Kindle Fires had way more online presence than iPads, but iPad Minis sold record numbers.
Ipad Minis cannibalized everything Apple sells and also they didn't cannibalize anything.
Apple is going to make a cheap phone but they're not going to make a cheap phone.
Teens say Apple is done. And Apple is sold out of products around the world.
China bought tons of Iphones but Apple got hammered by Samsung in China.
And Apple is, as always doomed.
But it's a buy with a target price of $1,100, $700, $600, $500, $400 and $250 all at the same time.
Got it.
Quote:
Originally Posted by 512ke
Wow I'm really learning a lot reading the news about Apple lately lol.
AT$T sold a record number of iPhone, but they didn't sell **** because Samsung sold way more.
Apple's Mac sales declined and they grew by 5% last quarter.
Kindle Fires had way more online presence than iPads, but iPad Minis sold record numbers.
Ipad Minis cannibalized everything Apple sells and also they didn't cannibalize anything.
Apple is going to make a cheap phone but they're not going to make a cheap phone.
Teens say Apple is done. And Apple is sold out of products around the world.
China bought tons of Iphones but Apple got hammered by Samsung in China.
And Apple is, as always doomed.
But it's a buy with a target price of $1,100, $700, $600, $500, $400 and $250 all at the same time.
Got it.
You forgot,
Android tablets now have 50% of the market, but no one uses them without changing their user agent string to look like an iPad
No, you are missing the point. It's the WSJ that is being shamed here, though not enough—yet.
AI was correct to report the WSJ's story straight, except their original headline was a little naive.
Quote:
Originally Posted by ScartArt
not sure I agree with the component yield reasoning. If Apple need 1m panels they order 1m panels. They don't order 2m in the hope that they get 1m working ones. Yield is the problem of the OEM.
From his point of view, they were trying to stock extra to make up for the back-order so they could push more volume as parts became available for their backorder while trying to fulfill new orders. Now that they are leveling off on production, i.e. figured out more efficient ways to produce the products in-time, they can back off stock orders and focus more on in-time orders..
Basically they are now leveling off to in-time order processing as you envision it above.
Makes sense to me. They (analysts) even predicted parts orders would level off/drop in december when Apple's lead times started drop to 1-2 days. So I'm left wondering why WSJ even reported this other than to try to drum up more rumor & conjecture to impact stock prices?
whereas MS price has stayed nearly flat for some years in spite of its very large volume of about 55 millions shares traded per day. obviously these are insititutional investors.
but of course the biggest scam stock hype of this era is Amazon. with an absurdly high price based on its hyped supposed future prospects that are impossible to connect logically or mathematically with its current business operations. and drawn from an average of just 3 million shares traded per day - because that is all the suckers that can be found!
and the tech industry's focus on - and vulnerability to - stock prices is of course a reflection of its crazy "hit a jackpot" mentality. as if. it's a fool's game.
There is no longer any need for any discussion of apple anywhere on the internets, these posts obsolete all others.
Instead of a paywall at WSJ to read their drivel they should have a WePayYouWall and pay people to read their fiction. Sad to see journalism so bad in the USA. Even sadder that WSJ was an American company last I checked. When was it favorable to back Samsung over a US based corporation? WSJ patriotism? Not much. It would be one thing if they actually reported facts (or anything of value). But making crap up is pretty slimey.
And....
Android tablets now have 50% of the market... but none of the manufacturers have ever given any hard sales numbers.
We get fuzzy numbers from Google saying "1.3 million Android devices were activated daily, and of those, 70,000 were tablets."
That's over 6 million new Android tablets hooking into Google every quarter. We'll have to take their work for it... since there's no way to verify that.
So why don't the manufacturers step up and claim their share of the market?
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Quote:
Originally Posted by Suddenly Newton
For its next trick, WSJ will print nude photos of, and also hack email and voicemail accounts belonging to various Apple executives.
Old Joke:
1st guy: "Do you have any nude pictures of your wife for sale?"
2nd guy: "Are you crazy? I respect my wife! The answer is no -- I'd never sell nude pictures of my wife!"
1st guy: "Do you want to buy some?"